The reason why the assumption of a representative agent is so popular in the equilibrium business cycle literature is mainly that equilibrium allocations are derived by solving a concave programming problem, whereas once heterogeneity is introduced it is necessary to solve for weights on...

Correctly or not, Ronald Coase is often credited with the doctrine that courts ought to adjudicate for efficiency, that "the value of production" should serve as the criterion for resolving disputes over the boundaries between property rights. The doctrine that courts ought to adjudicate for...

Using the properties of integrated and cointegrated economic time series, this paper derives an error correction model (ECM) of money demand from a dynamic optimization problem. A general form of the ECM is estimated for Canadian M2 and M2+ over the period 1968:I to 1989:IV. The ECM appears to...

We examine a monetary economy in which there is an absence of the temporal coincidence of wants, and households are free to barter. If the growth rate of the money supply is sufficiently small, monetary exchange is preferable. Nevertheless, barter may drive out money exchange even if monetary...

This paper examines the relationship between factor endowments and the pattern of trade when one of the factors is an exhaustible resource. Differences in the rate of time preference between countries determine the direction of trade, however, the length of the period over which each country...

This paper deals with the role of services in an open economy in the context of the Heckscher-Ohlin trade model. The analysis focuses on services associated with maintenance of durable goods. Assuming services are labour-intensive, we show the type of durable demanded in relatively...

Macroeconomic theories in which there is a fixed cost to changing prices have proliferated recently. This paper solves a menu-cost pricing problem faced by a monopolistic firm in continuous time and subject to both the stochastic aggregate price level emphasized by Sheshinski and Weiss (1983)...