Household consumption and saving behavior have been the central theme of recent macroeconomic literature. Following the work of Robert Hall (1978) and a series of papers by Fumio Hayashi, the focus of the literature has been on dynamic consumption behavior. Using the Family Income and...

The duration dependence of stock market cycles has been investigated using the Markov-switching model where the market conditions are unobservable. In the conventional modeling, restrictions are imposed that transition probability is a monotonic function of duration and the duration is truncated...

While financial liberalization has in general favorable effects, reforms in countries with poor regulation is often followed by financial crises. We explain this variation as the outcome of lobbying interests capturing the reform process. Even after liberalization, market investors must rely on...

This paper examines network effects on trade by comparing the trade patterns of foreign affiliates in the United States with the trade patterns of U.S.-owned firms. The evidence strongly supports the following hypotheses: 1) foreign affiliates behave differently from U.S. firms in their trade...

In this paper, we consider dynamic panel data models with possibly nonstationary initial conditions. We derive the asymptotic properties of the GMM estimators with various kinds of instruments when both N and T are large, where N and T denote the dimensions of the cross section and time series....