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The analysis of large panel data sets (with N variables) involves methods of dimension reduction and optimal information extraction. Dimension reduction is usually achieved by extracting the common variation in the data into few factors (k, where k N). In the present project, factors are...
Persistent link: https://www.econbiz.de/10011007621
The 100%-Money Plan advocated by Fisher (1936) has a Misesian avor as it aims at mitigating intertemporal discoordination by reducing (i) the discrepancy between investment and voluntary savings, and (ii) the manipulation of interest rates by monetary injections. Recent proposals to adopt the...
Persistent link: https://www.econbiz.de/10011147739
We develop a sovereign debt model with official and private creditors where default risk depends on both the level and the composition of liabilities. Higher exposure to official lenders improves incentives to repay but carries extra costs, such as reduced ex-post flexibility. The model implies...
Persistent link: https://www.econbiz.de/10011147740
This paper develops an empirical framework giving rise to a nonlinear behaviour of the exchange rate pass-through (ERPT). Rather than shifts between low and high infl ation, the nonlinearity arises when large swings in the exchange rate trigger market entries and exits of importing firms....
Persistent link: https://www.econbiz.de/10011147741
We describe three different extensive data sets on the Swiss market for basic health care insurance—a homogeneous product by construction. First, we provide descriptive statistics on market prices for period 2004 - 2010. Second, we present aggregated data on health plan choices made by Swiss...
Persistent link: https://www.econbiz.de/10009367195
We argue that a higher share of the private sector in a country’s external debt raises the incentive to stabilize the exchange rate. We present a simple model in which exchange rate volatility does not affect agents’ welfare if all the debt is incurred by the government. Once we introduce...
Persistent link: https://www.econbiz.de/10008556772
While the direct impact of geographic endowments on prosperity is present in all countries, in former colonies, geography has also affected colonization policies and, therefore, institutional outcomes. Using non-colonized countries as a control group, I develop an empirical strategy that...
Persistent link: https://www.econbiz.de/10008556773
Starting with Krugman (1980), much literature has analyzed how trade liberalization affects the economy based on the notion that trade is motivated by consumer’s love of variety. In this paper, I augment these preferences by the determinants of demand for heterogeneous products. The model...
Persistent link: https://www.econbiz.de/10008556774
I analyze how lack of commitment affects the maturity structure of sovereign debt. Governments balance benefits of default induced redistribution and costs due to income losses in the wake of a default. Their choice of short- versus long- term debt affects default and rollover decisions by...
Persistent link: https://www.econbiz.de/10004965367
Recent contributions on offshoring often assume that firms can freely split their production process into separate steps which can be ranked according to the cost savings from producing abroad. We replace this assumption by the notion of a technologically determined sequence of production steps....
Persistent link: https://www.econbiz.de/10004965368