This paper characterizes optimal fiscal and monetary policy in a new keynesian model with sectorial heterogeneity in price stickiness. In particular, we (i) derive a purely quadratic welfare-based loss function from an approximation of the representative agent's utility function and (ii) provide...

We develop a model with two provinces, producing two goods: one mobile and the other not. The mobile good is taxed according to the destination principle by the local government; it is also federally taxed. People decide to buy the good at the most advantageous price. Namely they can buy...

This paper studies the effect of trade openness on output volatility. We find that trade openness generally increased output volatility, although this effect was stronger and more significant during 1950-1975 than during 1975-2000. However, if we split the sample into developed and developing...

Consider a world with two people, 1 and 2, where person 1 (the proposer) may offer to help person 2 (the responder). The proposer may be altruistic towards the responder either out of a genuine desire to make her happy or out of guilt. The responder derives disutility from apparent acts of...

Because of its importance to a dynamic development of the economy, the formation of new firms has been viewed with greater interest from policy makers at the national, regional and local levels and from representatives of private business associations, formal and informal networks. According to...

We propose a model to estimate the price volatility in of the Mexican Export Crude Oil Blend. The analysis relies on the conditional standard deviations obtained from a GARCH model. Data includes diary oil prices between January 2nd, 1998 and February 14th, 2007. The chosen model is of the GARCH...

The expansion and the rooting of non European immigrants which is taking place in the more advanced European countries, mirror a world context which is marked by imbalances both in terms of growth and welfare. A correct analysis of migration, of its structural characteristics and of the new...

Nigeria was incorporated in 1914 when Frederick Lugard(First Governor-General) amalgamated the two British protectorates of Northern and Southern Nigeria and the Crown colony of Lagos into a single entity. The primary reason for almalgamation was economic rather than political. It is therefore,...

This paper describes the structure and construction of a social accounting matrix (SAM) for Pakistan for 2001-02. A SAM is an internally consistent extended set of national accounts that disaggregates value-added in each production activity into payments to various factors (e.g., land, labour,...

New and old mainstream macroeconomics argues that price flexibility stabilizes the economy. After a decline in aggregate demand, the more rapid prices fall, the faster output returns to its full employment level. The theoretical basis for this result is the well known "Pigou effect". However...