In contrast with expected utility theory, empirical findings indicate that decision-makers are sensitive to departures from reference points rather than states. Several tests of the reference-dependent preference framework have been carried out in experimental economics, and to a smaller extent...

Existing work in growth empirics either assumes linearity of the growth function or attempts to capture non-linearities by the addition of a small number of quadratic or multiplicative interaction terms. Under a more generalized failure of linearity or if the functional form taken by the...

This study deals with the link between exchange rate misalignments (ERM) and economic growth, for a large sample of advanced and emerging economies on the period 1982-2010. The estimation of equilibrium exchange rate (EER) is based on a FEER approach. The relation "misalignments-growth" is...

The assumption of linearity is tested using five statistical tests for the US and the Canadian unemployment rates. An AR(p) model was used to remove any linear structure from the series. Strong evidence in favour of non-linearity was found in the case of Canada. The result for the US is not so...

This paper examines fiscal sustainability in fifteen European countries. Motivated by the statistical power of the advances in panel unit root tests, we apply these new tools to test whether or not the fiscal imbalance is sustainable in the long run. We also employ the exponential smoothing...

For the biofuel markets and related commodities, we study their price transmission, which is in fact equivalent to studying price cross-elasticities. Importantly, we focus on the price dependence of the price transmission mechanism. Several methodological caveats are discussed. Specifically, we...

We provide a reappraisal of income convergence across European regions over the period 1990-2005 by using a semiparametric partially linear model to approximate the relationship between the average growth rate of GDP per capita and the initial GDP per capita. Estimation results point out both...

The aim of this paper is to study the relationship between terms of trade and real exchange rates of commodityproducing Commodity currencies,countries on both the short and the long run. We pay particular attention to the dominant role played by oil among commodities by investigating the...

One of the lessons learned from the recent financial crisis is the need to understand the systemic risk in the financial system – i.e., the risk (or probability) for the financial system ‘as a whole’ to turn unstable. As there are analogous concepts in the physics of complex systems, three...

Education being an important component of human capital has always attracted the attention from economists, researchers and policy makers. Governments are trying to improve the human capital by pumping more investments in education. Education increases an individual’s earning potential, but...