Standard international economic models with life cycle/permanent income consumption behavior predict that international portfolio diversification leads to high bilateral consumption correlations. Thus international consumption correlations have been empirically estimated as a test of...

Standard international economic models with life cycle/permanent income consumption behavior predict that international portfolio diversification leads to high bilateral consumption correlations. Thus international consumption correlations have been empirically estimated as a test of...

This paper develops a method of testing levels of economic integration based upon consumption smoothing, and tests it using data on trade balances across Canadian provinces. The results indicate the provinces are highly integrated within Canada, but integration between Canada and the rest of the...

This paper examines the concept of inflation persistence in macroeconomic theory. It begins with a definition of persistence, emphasizing the difference between reduced]form and structural persistence. It then examines a number of empirical measures of reduced]form persistence, considering the...

A growing body of literature examines alternatives to the rational expectations hypothesis in applied macroeconomics. This paper continues this strand of research by examining the role survey expectations play in the inflation process and reports three principal findings. One, short-run...