The paper addresses the question of the fiscal perspectives within the Economic and Monetary Union (EMU). By using a panel data analysis associated with an interpretation in terms of differences instead of levels, the results show a steady convergence of public deficits across the EMU, and that...

WHAT IS ECONOMIC DEVELOPMENT ? Economic development means sustainable qualitative changes in the living conditions of general public in a country over a long period of time. Living condition means economic wellbeing not only in material sense but also in social sense. Conventionally per capita...

This paper tests the joint hypotheses that policymakers engage in fiscal policy opportunism and that voters respond by rewarding that opportunism with higher vote margins. Furthermore, it investigates the impact of fiscal illusion on the previous two dimensions. Empirical results, obtained with...

This paper reviews a number of recent contributions that study pension design with myopic individuals. Its objective is to explore how the presence of more or less myopic individuals affects pension design when individuals differ also in productivity. This double heterogeneity gives rise to an...

In our recent paper, (Reinhart and Reinhart, 2010) we examine the behavior of real GDP (levels and growth rates), unemployment, inflation, bank credit, and real estate prices in a twenty one-year window surrounding selected adverse global and country-specific shocks or events. In this note, we...

We analyze the economic forces underlying cross-border Mergers and Acquistions (M&As) using a large bilateral panel data set. The frequent occurrence of "zero" observations provides essential information on the structure of M&A flows, which we model empirically using a two-stage procedure. At...

This paper derives and estimates rules for fiscal policy that prescribe the optimal response to changes in unemployment and debt. We combine the reduced form model of the economy from a linear VAR with a non-linear welfare function and obtain analytic solutions for optimal policy. The variables...

The paper studies risk mitigation associated with capital regulation, in a context when banks may choose tail risk assets. We show that this undermines the traditional result that higher capital reduces excess risk-taking driven by limited liability. When capital raising is costly, poorly...

The main objective of the paper is to provide an estimation of the impact of the investments in education and science in Bulgaria, financed by the European structural instruments. It provides net impact assessment as of end of 2012 as well as projections of potential effect until 2020. The...

The present paper firstly examines and comments the arguments proposed by Werner Sinn and Wollmershaeuser in their paper on Target loans, current account balances and capital flows: the ECB’s rescue facility. Secondly, this contribution suggests an alternative view for solving the crisis in...