Empirically, the relative volatility of consumption to output decreases with income. The standard small-open economy real business cycle model, however, produces a positive relationship. We can recover the negative relationship when we augment the standard model with micro-founded expropriations...

We construct a novel Exchange Rate Stance Index (ERSI) to measure the magnitude of oral interventions that talk down the Australian dollar - a preference for a weaker domestic currency expressed by the Reserve Bank of Australia (RBA) through public speeches and monetary policy statements in...

We investigate an unexplored link between the US mortgage spread and business cycle and house price fluctuations in emerging market economies (EMEs). An increase in the US mortgage spread leads to substantially lower output, investment, consumption, house and stock prices, and to an improvement...