between the United States and the rest of the world, this paper asks to what extent an asymmetric productivity shock in the … second half of the 1990s. The paper concludes that the Balassa-Samuelson effect of such a productivity shock is only part of … the story. A second shock, a broadly defined risk premium shock, and some uncertainty about the persistence of both shocks …

between the United States and the rest of the world, this paper asks to what extent an asymmetric productivity shock in the … second half of the 1990s. The paper concludes that the Balassa-Samuelson effect of such a productivity shock is only part of … the story. A second shock, a broadly defined “risk premium” shock, and some uncertainty about the persistence of both …