Outside observers could be forgiven for expecting Ecuador to suffer terribly during and after the recent global crisis. Two of the country’s largest sources of foreign earnings, petroleum exports and remittances from abroad, crashed during the global recession. Furthermore, lacking its own...

This paper investigates the causes of western Germany's remarkably poor performance since 1992. It challenges the view that Germany's poor economic record and marked deterioration in public finances since unification might be largely attributable to that event. Instead, the analysis highlights...

This paper looks at Ecuador’s financial and regulatory reforms during the past five years, perhaps the most comprehensive of any country in the 21st century: taking control over the central bank, regulating capital outflows, taxing the financial sector, encouraging domestic investment and...

The quantity theory of money is a theory that the quantity of money matters in income creation. Curiously, this theory may be developed in two mutually exclusive manners. One is by thinking that the quantity of money that matters in income creation is the quantity of money “in” circulation...

R. G. Hawtrey, like his younger contemporary J. M. Keynes, was a Cambridge graduate in mathematics, an Apostle, deeply influenced by the Cambridge philosopher G. E. Moore, attached, if only peripherally, to the Bloomsbury group, and largely an autodidact in economics. Both entered the British...

The study develops a standard representative-agents’ New Keynesian model for macroeconomic analysis in a developing African economy. Using Bayesian estimation techniques and Ghanaian dataset, the core objective of the paper is to determine the best suited monetary policy rule for Ghana. After...

In this paper, we investigate the effects of an anticipated future change in monetary policy regime in small open economies targeting either inflation or the exchange rate. The announcement of a future change in the monetary policy regime triggers an immediate change in the behavior of...

Venezuela’s current growth is generally described as unsustainable, with various negative scenarios put forth, including spiraling debt, inflation, and balance of payments crises. However, these pessimistic forecasts have been far off the mark for most of the past decade. This paper looks at...

Thanks to the banking crisis, there has been a greater awareness that leading economic theories and models, as well as influential advanced textbooks in macroeconomics and monetary economics may have been amiss when they neglected to include banks in their analyses. Economists are now labouring...

This paper examines the macroprudential roles of bank capital regulation and monetary policy in a Dynamic Stochastic General Equilibrium model with endogenous financial frictions and a borrowing cost channel. We identify various transmission channels through which credit risk, commercial bank...