type="main" xml:lang="en" <title type="main">SUMMARY</title> </section> <title type="main">Fiscal policy and interest rates in Europe</title> <p> The appetite for fiscal discipline has been steadily declining among most industrial countries. In the past, fiscal profligacy would have been punished by markets with higher interest rates and, in some cases, also...</p>

Books reviewed in this article: Richard Friberg, <i>Exchange Rates and the Firm: Strategies to Manage Exposure and the Impact of EMU</i> Stephen Cecchetti, Hans Genberg, John Lipsky, and Sunil Wadhwani, <i>Asset Prices and Central Bank Policy</i> Michael J. Greenwood and John M. McDowell, <i>Legal U.S....</i>

Determining how imports react to cyclical and secular (long term) factors has been a recurrent theme in the empirical trade literature. The evidence suggests that cyclical income elasticities of import demand are generally higher than long term elasticities - particularly for basic materials and...