Following a brief review of the recent history of GDP-linked instruments, this paper proposes a set of tools to examine the quantitative properties of GDP-linked warrants. It argues that trigger conditions should be clearly identifiable and payment amounts easily calculable. Based on a design...

This paper emphasizes the importance of total factor productivity (TFP) developments in the nontradables sector to quantitatively demonstrate that the time-honored Balassa-Samuelson hypothesis does not generally apply to episodes of economic growth. Though the Balassa- Samuelson hypothesis...

Credit and business cycles play an important role in economic research, especially for central banks and supervisors. We reexamine a very useful dynamic model proposed by Kiyotaki and Moore (1997) of an economy with an endogenous credit limit. They claim that a small temporary shock generates...

Credit and business cycles play an important role in economic research, especially for central banks and supervisors. We reexamine a dynamic model proposed by Kiyotaki and Moore (1997) of an economy with an endogenous credit limit. They claim that a small temporary shock generates large and...

In this paper we analyse the relationship between increased exchange rate flexibility and economic growth and its volatility in emerging market economies. We also investigate the implications of exchange rate flexibility for financial market development. We do not find a robust correlation...

Economic derivatives allow traders to take direct positions on the outcomes of macroeconomic data releases. In contrast to survey-based measures, the prices of economic derivatives provide information on the entire probability distribution underlying these expectations, not just point estimates....