In this paper we use recent developments on threshold autoregressive (TAR) models that allow us to derive endogenously threshold effects in the evolution of the Spanish budget deficit. Specifically, a mean-reverting dynamic behaviour of the budget deficit should be expected once such threshold...

In this article we re-examine the long-run sustainability of US budget deficits, using Bai and Perron's multiple structural change approach. While the deficit would have been weakly sustainable over the full sample (1947:1-2005:3), strong sustainability would appear only between January 1982 and...

This Paper offers a quantitative assessment of the effectiveness of capital controls in Spain during the period 1986-1990. The analysis is based on a portfolio-balance model Previously estimated for the Spanish economy, where the complete elimination of capital controls is simulated. Our results...

The balance of payments can act as a constraint on the rate of growth of output, since it puts a limit on the growth in the level of demand to which supply can adapt. This article examines this issue for the case of several transition countries, namely, those Central and Eastern European...

Bajo-Rubio O. and Diaz-Roldan C. (2005) Optimal endowments of public capital: an empirical analysis for the Spanish regions, Regional Studies 39 , 297-304. Regional infrastructure policies, through increased public investment, are widely used to promote the development of poorer regions in...

Insurance Mechanisms against Asymmetric Shocks in a Monetary Union : a Proposal with an Application to EMU, by Oscar Bajo-Rubio and Carmen Díaz-RoldánIn this paper we propose a simple, automatic insurance mechanism designed to cope with asymmetric shocks in a monetary union, which could be...