The ongoing global financial crisis has been preceded by a steady rise in global current account imbalances. Recently, in the course of the global recession, global imbalances have declined, albeit without having disappeared completely. As the outlook for global growth gets brighter, it is...

We study the implications of alternative monetary targeting procedures for real interest rates and economic activity. We find that countercyclical monetary policy rules lead to higher real interest rates, higher average tax rates, lower output but lower variability of tax rates and consumption...

This paper provides a model of social hysteresis whereby long, deep recessions demotivate workers and thereby lead them to change their work ethic. In switching from a pro-work to an anti-work identity, their incentives to seek and retain work fall and consequently their employment chances fall....