This paper studies the effect of reductions in information asymmetry - information globalization - on international risk sharing and trade flows. Information frictions are often invoked to explain low levels of international trade beyond those that measured trade frictions (tariffs,...

Is monetary policy less effective in increasing real output during uncertain times? We argue that firm uncertainty adds flexibility to the aggregate price level and thus the effects of monetary policy are reduced in times of high uncertainty. To construct the argument we develop a price-setting...