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Economic geography aims to explain agglomeration primarily through the channels of increasing returns, monopolistic competition and international factor mobility. By contrast, this paper constructs a theoretical model based on capital market frictions. Monopolistically competitive firms are run...
Persistent link: https://www.econbiz.de/10013059799
To answer whether capital mobility exacerbates or dampens the agglomerative tendency of footloose entrepreneurs, this paper incorporates a footloose-capital with a footloose-entrepreneur manufacturing industry based on a tractable analytical structure with two identical regions. The model shows...
Persistent link: https://www.econbiz.de/10014176701
This paper sets up a two country monopolistic competition model with intra-industry trade to study the effects of an exogenous differential in wage and social policies on the location of industry. Two model scenarios are considered. In the traditional one with physical capital, such a...
Persistent link: https://www.econbiz.de/10011438609
This paper uses a two country trade and geography model of monopolistic competition to study the effects of wage policies and social policies on the location of industry. It is first shown that a union wage push in one of two otherwise identical countries induces a relocation of firms which...
Persistent link: https://www.econbiz.de/10013319979
Persistent link: https://www.econbiz.de/10013436301
We develop a heterogeneous-firms model with trade in goods, labor mobility and credit constraints due to moral hazard. Mitigating financial frictions reduces the incentive of high-skilled workers to migrate to one region such that an unequal distribution of industrial activity becomes less...
Persistent link: https://www.econbiz.de/10010344666
We study a two-sector, two-period model with learning externalities in the modern sector and imperfectly integrated capital markets. We find that higher capital market integration lowers the requirements on the learning pattern necessary for free trade to lead to an equilibrium with maximal...
Persistent link: https://www.econbiz.de/10014220345
In this paper, we conduct an analysis of the implications of capital controls for financial stability. We study a financial transaction (Tobin) tax applicable to cross-border capital flows in a multi-good, multi-country dynamic equilibrium model with incomplete financial markets and...
Persistent link: https://www.econbiz.de/10012905929
The aim of the present University notes is to provide a brief but comprehensive overview of the European Commission’s proposal for a Regulation of the European Parliament and of the Council “on Markets in Crypto-Assets (…)” (MiCAR), which was submitted on 24 September 2020. It is not...
Persistent link: https://www.econbiz.de/10013228416
I present a model that provides a theoretical solution to the Lucas Puzzle using Financial Efficiency, which is a time-varying component of TFP. The model predicts that a financially underdeveloped economy is to benefit from financial integration through FDI capital inflow only if it experiences...
Persistent link: https://www.econbiz.de/10013243308