This paper analyzes the drivers and consequences of sudden stops of capital flows. It focuses on the impact of external vulnerability on the depth and length of sudden stop crises. The authors analyze 43 developing and developed countries between 1993 and 2006. They find evidence that external...

Instrumental variable methods are widely used to make inferences about the impact of some variable on economic outcomes; for example, whether or not institutions influence long term growth. However, the test-statistics used for making these inferences are based on the generally unrealistic...

This paper develops asymptotically pivotal structural change tests in simultaneous equations with weakly identified parameters. In former literature, Caner (2007) proposes boundedly pivotal structural change tests when there are weakly identified parameters. The tests developed in this article...

Public debt has surged during the current global economic crisis and is expected to increase further. This development has raised concerns whether public debt is starting to hit levels where it might negatively affect economic growth. Does such a tipping point in public debt exist? How severe...

We provide a new theory for nodewise regression when the residuals from a tted factor model areused. We apply our results to the analysis of the consistency of Sharpe Ratio estimators when there are many assets in a portfolio. We allow for an increasing number of assets as well as time...

In this paper we analyze GMM with strong and nearly-weak instruments. In the nearly weak-GMM, the correlation between the instruments and the first order conditions decline at a slower rate than root T. We find an important difference between the nearly-weak case and the weak case. Inference...