This paper analyzes consumers' price elasticities of demand for fossil fuels, and how a reduction of fossil fuel subsidies can lead to important reduction in CO2 emissions for various groups of countries that have relatively high fossil fuel subsidies and notably on diesel, including countries...

We consider impacts of fossil fuel subsidy reforms on economic growth, focusing mostly on the Middle East and North Africa (MENA) countries. The main empirical result is that a country that initially subsidizes its fossil fuels, and then eliminates or reduces these subsidies, will as a result...

The Norwegian currency basket and the NOK/USD exchange rate observed at two different times of the day are modeled as ARCH or GARCH process. The analysis yields four main conclusions. First, the conditional variance of the basket index is smaller than the conditional variance of the NOK/USD...

We formulate a mathematical model for the optimal control of the exchange rate. The control consists of a stochastic control, and an impulse control. We give general sufficient conditions for its solution. We consider a government that has two means of avoiding the foreign exchange rate...

Using the global games method, I extend the credit cycles model of Kiyotaki and Moore (1997) in three ways. First, the extended model examines the strategic interactions among monetary authorities, creditors, and an entrepreneur. Second, both creditors and monetary authorities have imperfect...

This paper analyzes central bank policies on the monitoring of banks in distress in which liquidity provisions are conditional on performance when a bad shock occurs. A sequential game model is used to analyze two policies: the first one in which the central bank acts with discretion and the...

We derive the optimal exchange rate policy for a small open economy subject to terms-of-trade shocks. Firm owners and workers are risk averse but workers more so. Wages are given or partially indexed in the short run, and capital markets are imperfect. The government sets the exchange rate to...

In a model of repeated games, we determine the conditions under which cooperation is an equilibrium outcome among the G-20 countries. We consider first, that members are uncertain about the lifespan of the G-20. Second, the nature of member countries and their interrelations can change because...

We analyze firms’ investment behavior, differentiating firms according to the cash flow levels they experience during their lifecycles. We consequently consider the firm as the basic unit and not firm-year observations. Firms with persistent positive cash flow show higher investment-cash flow...