We extend the `rational partisan model' of inflation and unemployment by introducing inflation and unemployment dynamics. We investigate the case of Greece, which has had a polarized political system and a problem of persistently high inflation in the last two decades. High inflation can be...

In this paper I investigate the relationships between wage adjustment, competitiveness, and aggregate fluctuations in the United Kingdom. This is done in the context of a model based on the distinction between internationally traded and nontraded goods, which is estimated and thoroughly tested....

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In the paper I examine the trade-offs between internal and external balance and the role of macroeconomic policy in Greece. I estimate and test versions of the two principal open economy macromodels: the imperfect-substitutes, one-sector model, and the two-sector model with nontraded goods. Both...

This paper presents an investigation of the empirical significance of the Lucas Critique for the Phillips Curve. The investigation is carried out with annual historical time series for the United Kingdom (1857-1987) and the United States (1892-1987). The results, for two different models of the...

In this paper I examine optimal monetary policy and the informational implications of the Phillips curve in a stochastic model of a small open economy. It is assumed that the economy produces both traded and non-traded goods, that capital mobility is perfect and that the economy faces a variety...