This paper builds a framework for the analysis of macroeconomic fluctuations that incorporates the endogenous determination of the number of producers and products over the business cycle. Economic expansions induce higher entry rates by prospective entrants subject to irreversible investment...

International financial integration has greatly increased the scope for changes in a country's net foreign asset position through the "valuation channel" of external adjustment, namely capital gains and losses on the country's external assets and liabilities. We examine this valuation channel...

This paper reviews the problems that must be resolved at the Intergovernmental Conference in 1996 to clear the way for European Monetary Union: locking in Germany's commitment to the project, and reconciling EMU with variable geometry. It reviews what we know about the costs and benefits of EMU...

The paper analyses monetary and fiscal policy interactions in a three-country world, interpreted to represent two EU economies and the rest of the world. The analysis extends well-known results in the literature on international policy spillovers by investigating the effects of different sizes...

This paper analyses US–European policy interactions under different assumptions about the policy-making regime and the nature of the fiscal environment, contrasting the standard Keynesian case with an anti-Keynesian case in which government spending cuts are expansionary. When fiscal policy is...

We develop a stochastic, general equilibrium, two-country model of trade and macroeconomic dynamics. Productivity differs across individual, monopolistically competitive firms in each country. Firms face a sunk entry cost in the domestic market and both fixed and per-unit export costs. Only...

We study the e¢ ciency properties of a dynamic, stochastic, general equilibrium, macroeco- nomic model with monopolistic competition and …rm entry subject to sunk costs, a time-to-build lag, and exogenous risk of …rm destruction. Under inelastic labor supply and linearity of produc- tion in...

International financial integration has greatly increased the scope for changes in a country's net foreign asset position through the valuation channel, namely capital gains and losses on external assets and liabilities. We examine this valuation channel in a dynamic equilibrium portfolio model...