For the widely-used linear-quadratic model of stable IEAs the key results are: (i) if the members of the IEA act in a Cournot fashion with respect to non-signatories, a stable IEA has no more than 2 signatories; (ii) if the signatories act as Stackelberg leaders, a stable IEA can have any number...

This paper contributes to the empirics of the intertemporal approach to the current account. We use a cointegrated VAR framework to identify permanent and transitory components of country-specific and global shocks. Our approach allows us to empirically investigate the sensitivity to persistence...

This paper develops a new simulation estimation algorithm that is particularly useful for estimating dynamic panel data models with unobserved endogenous state variables. The new approach can deal with the commonly encountered and widely discussed ``initial conditions problem,'' as well as the...

The use of artificial regressions to compute the variance of the difference of pairs of panel data estimators that cannot be ranked in terms of efficiency is considered. It is illustrated how it is possible to get (asymtotically) valid estimators of covariance matrices for differences between...

A key issue in monetary policy is that on the importance of following systematic behaviours. The paper revisits the classic debate on rules versus discretion focusing on the design of instrument rules in a manner that push discretionary policy choices in the direction of the commitment...