Diffusion index models have received considerable attention from both theoreticians and empirical econometricians in recent years. One reason for this is that datasets with many variables are increasingly becoming available and being utilized for economic modelling, and another is that common...

Central banks regularly monitor select financial and macroeconomic variables in order to obtain early indication of the impact of monetary policies. This practice is discussed on the Federal Reserve Bank of New York website, for example, where one particular set of macroeconomic indicators is...

This paper examines the long-run determinants of immigration to Germany using a modified version of the Ricardo model. After a brief overview of labour flows to Germany and the related empirical literature, a Ricardian model of migration is estimated using static panel data methods. The results...

Unlike in Asia, the manufacturing sector has not (yet) become a driver of structural change in Africa. One common explanation is that the natural resource-focus of many African economies leads to Dutch disease effects. To test this argument for the case of newly found oil in Ghana we develop a...

Large differences in national price levels exist across countries. In this paper, I develop a general equilibrium model predicting that these differences should be related to countries' exchange rate regimes. My empirical findings confirm that countries with fixed exchange rate regimes have...

This paper provides an empirical investigation into the determinants and stability of the aggregate wage inflation process in the United States over the 1967-2000 period. Using compensation per hour as the measure of wages, we specify a Phillips curve model that links wage growth to its past...

This paper estimates the effect of sovereign debt renegotiation on international trade. Sovereign default may be associated with a subsequent decline in international trade either because creditors want to deter default by debtors, or because trade finance dries up after default. To estimate the...

Recent empirical research finds that pairs of countries with stronger trade linkages tend to have more highly correlated business cycles. We assess whether the standard international business cycle framework can replicate this intuitive result. We employ a three-country model with transportation...

Exchange rate regime optimality, as well as monetary policy effectiveness, depends on the tightness of the link between exchange rate movements and import prices. Recent debates hinge on whether producer-currency-pricing (PCP) or local currency pricing (LCP) of imports is more prevalent, and on...

Debit cards are overtaking credit cards as the most prevalent form of electronic payment at the point of sale, yet the determinants of a ubiquitous consumer choice - debit or credit? - have received relatively little scrutiny. Several stylized facts suggest that debit-card use is driven by...