This study seeks to explain why crude oil prices fluctuate, the main cause being the quota regime, which characterises the OPEC agreements. Given that the Saudi oil supply is inelastic in the short term, a shock in the oil market is accommodated by an immediate price change. In contrast, a...

Harrison, Rutherford and Tarr (1997) use a multiregional Computable General Equilibrium (CGE) model with a CES multistage demand system, imperfect competition, increasing returns to scale (IRS), and two endogenous price elasticities of demand perceived by a firm in each national market, in order...

This paper examines the welfare implications of a country joining a currency union as opposed to operating in a flexible exchange rate regime. At the country level, the suboptimal response to domestic and foreign shocks and the inability of setting inflation at the desired level may be offset by...