Development accounting shows that a significant part of cross-country income differences is attributed to differences in total factor productivity (TFP), but the sources of TFP differences are not well understood. This paper considers the role of international trade to explain cross-country...

This paper examines the persistent deterioration in the international external position of the U.S. over the past 60 years. I develop a model without Ponzi schemes and arbitrage opportunities that accounts for both the secular rise and the cyclical variations in the U.S. international debt...

Central to the global impacts of China's emergence has been its structural imbalance (its excess product supply and excess saving), but this has diminished considerably in the transition years since 2010. These imbalances are now reversed as its consumption expands faster than its GDP and so the...

In the standard inter-temporal trade theory, a trade surplus would only be welfare-reducing if distortions exist in either savings or investment. In comparison, we empirically assess a new welfare channel: a trade surplus may alter the shipping costs in a way that induces a higher level of...

As the world economy recovered and grew, the price of oil rose markedly, peaking at almost $70 per barrel in 2005 before ending the year at $61 per barrel. Today, the price continues to hover at around $65. This sustained rise in prices has generated hundreds of billions of dollars of extra...