Foreign direct investors face uncertainty about government's type of the host country. In a two period game, we allow the host country's government to mitigate such uncertainty by sending a signal through fiscal policy. Our main finding states that a populist government may mimic a conservative...

In this paper we obtain conditions under which the central bank loss function is strictly convex in four different states of the economy: booming economy, recession, high inflation and high output. Moreover, we found that when inflation and output are linear functions of the monetary policy...

We studied the population dynamics of producers and parasites in a developing economy through the Lotka-Volterra model. Our baseline model found a cyclical equilibrium between these two groups of agents. When the equilibrium output is low, we propose that economy is in a poverty trap, such that...