We design a new, implementable capital requirement for large financial institutions (LFIs) that are too big to fail. Our mechanism mimics the operation of margin accounts. To ensure that LFIs do not default on either their deposits or their derivative contracts, we require that they maintain a...

The election mechanism has difficulties in selecting the most able candidates and deselecting less able ones. In a simple model we show that the power of elections as a selection and incentive device can be improved by requiring higher vote thresholds than 50% for incumbents. A higher vote...

This paper examines the role of the burden of proof (BoP) in National Treatment (NT) disputes under trade agreements. In the situation under study, imports may cause environmental damage, in which case less favorable treatment of imported products may be globally desirable from an international...

Two issues related to mapping a multi-sector model into a reduced-form value-added model are often neglected: the composition of intermediate goods, and the distinction between the productivity indices for value added and for gross output. We illustrate their significance for growth accounting...

This paper examines how the distribution of prices and consumer welfare change with the number of competitors in a model where consumers di¤er in the amount of price information they have. We only assume that an increase in the number of competitors results in an increase in the probability...

It is often alleged that PTAs involving the EC and the US include a significant number of obligations in areas not currently covered by the WTO Agreement, such as investment protection, competition policy, labour standards and environmental protection. The primary purpose of this study is...

This paper examines the effect of party affiliation on an individual’s political views. To do this, we exploit the party realignment that occurred in the U.S. due to abortion becoming a more prominent and highly partisan issue over time. We show that abortion was not a highly partisan issue in...

This paper brings the aid effectiveness debate to the sub-national level. We hypothesize the non-robust results regarding the effects of aid on development in the previous literature to arise due to the effects of aid being insufficiently large to measurably affect aggregate outcomes. Using...

We construct a model of revolution and transition to democracy under an individualistic and a collectivist culture. The main result is that, despite facing potentially larger collective action problems, countries with an individualistic culture are more likely to end up adopting democracy faster...

An influential literature has documented large differences across countries and industries in terms of product quality. It is important to understand the determinants of these differences, because the production of high-quality goods influences key aspects of economic performance. In this paper,...