When attempting to identify empirical regularities in consumption patterns, their tremendous diversity across countries represents both a major opportunity and challenge. For example, consumers in rich countries devote less than 20 percent of their budget to food, while this rises to more than...

The Big Mac Index, introduced by The Economist magazine 21 years ago, claims to provide the “true value” of a large number of currencies. This paper assesses the economic value of this index. We show that (i) the index suffers from a substantial bias; (ii) once the bias is allowed for, the...

Growth in the world economy is not shared equally among all countries, with some growing faster, some slower and some not at all. The cross-country distribution of growth is a useful tool for analysing the inequality of growth. The appropriately-weighted first moment of this distribution is...

(1) The paper uses the substitutability between goods to model the transmission to other products of a consumption shock to one product. The framework is used to analyse the impact on drinking of legalisation of marijuana. For all types of consumers for example, the results indicate that...

The aim of this paper is to estimate the length of the long run in the foreign exchange market. We do this by examining the link between exchange rates and relative prices, based on the implications of purchasing power parity (PPP) theory. Using a new approach, we test if the ratios of variances...

The Millennium Boom of 2003–2011 made the resources industry hugely profitable and led to a surge in new projects around the world. This had major implications for the Australian economy: resource investment accounted for almost half of all business investment at the peak, the capitalisation...