The target zone approach in its several incarnations and refinements into the blueprint addresses the central issues in international monetary reform. However, both theoretical considerations and the analysis of Europe's experience with a tight exchange rate system suggest that its recent...

We take an AK model to the PWT data. In the model both technology (intratemporal) and investment (intertemporal) shocks determine the variation of the growth rate. In earlier work we looked at singular models where we extracted only the technology shock using the policy functions from dynamic...

This paper is a study of Danish aid policy from the early 1960s to 1995. It includes (i) a review of officially stated aims and criteria, (ii) a descriptive analysis of actual behaviour in international comparative perspective, (iii) a review of the theoretical and empirical aid allocation...

An important result of Hurwicz [2] states that a performance correspondence assigning Pareto optimal allocations to exchange equilibria, which is Nash implementable, must be the Walras equilibrium correspondence. In the present paper, this result is extended to economies over time with the...

While many preceding studies on R&D discuss the equilibrium amount and speed of the R&D investment, this paper focuses on its equilibrium direction. Under a broad class of parametric conditions, there is a pure-strategy equilibrium in which multiple firms "cluster", i.e. search for the same...

I study the implications of agency frictions for the pricing policy of institutional market makers. In a setting where a market maker cannot observe the actions of an employed trader, I derive the optimal compensation structure and pricing policy. The theory demonstrates that incentive...

Many empirical questions about economic growth and development are left open due to the lack of long time series of reliable GDP estimates. The share of the labor force employed in agriculture can fill this gap. Agricultural employment shares are highly correlated with GDP per capita, less prone...

Cooperation can be induced by an authority with the power to mete out sanctions for free riders, but law enforcement is prone to error. This paper experimentally analyzes preferences for and consequences of errors in formal sanctions against free riders in a public goods game. With type I...

We show that societies with a history of irrigation-based agriculture have been less likely to adopt democracy than societies with a history of rainfed agriculture. Rather than actual irrigation, the empirical analysis is based on how much irrigation potentially can increase yields. Irrigation...

I establish a positive relationship between family ties and civic virtues, as captured by disapproval of tax and benefit cheating, corruption, and a range of other dimensions of exploiting others for personal gain. I find that family ties are a complement to social capital, using within country...