This paper discusses a model corporate tax system based on the application of the residence principle. This tax system, while preserving national sovereignties, minimizes the distortions arising from international capital mobility. The paper is motivated by an analysis of European capital income...

Countertrade agreements in international trade refer to a practice in which an exporter agrees to purchase in the future, from the importer, commodities proportional to his original export sale. The paper analyzes why it might be efficient for agents to undertake trade through a reciprocal...

Do plans for a monetary union in Europe call for limits on the freedom of the member countries to use fiscal policy? To provide a tentative answer, we simulate the IMF model MULTIMOD, given various shocks, in the case of a European Monetary Union consisting only of France and Germany. The...

We use a monetary (Dornbusch) model of the exchange rate and introduce speculative dynamics, in which fundamentalists and chartists interact. The resulting non-linearities in the model produce `chaotic' behaviour of the exchange rate. We also analyse the effects of money-stock surprises in such...

This paper investigates the relation between the rise in external debt and fiscal developments in Greece. We use an intertemporal model of optimal private-sector savings to argue that stabilization of the public debt/GDP ratio will be sufficient to stabilize the external debt/GDP ratio as well....

The completion of the European Market envisaged after 1992 will change rapidly the external conditions faced by the Greek economy through liberalization of the current and capital accounts. It is not expected, however, to alter as fast the duality inherent in Greek productive structure which...

This paper employs the recursive utility approach, based on quadratic felicity functions and constant absolute risk aversion, to distinguish between risk aversion and intertemporal substitution. Stochastic dynamic programming yields closed-loop linear decision rules for the CARA-LQ problem....

We analyse an infinite-period model of duopolistic competition in a market with consumer switching costs, in which in every period new consumers arrive and a fraction of old consumers leaves. We show that prices (and profits) are higher than in a market without switching costs, and that this...

Recent contribution emphasize that the presence of exchange rate target zones has important effects on the within-band behaviour of exchange rates. We show that the implications of available models are strikingly inconsistent with European Monetary System data, and we propose a model of...

A two-country, intertemporal, perfect-foresight model with micro foundations, Cobb-Douglas preferences and technologies, floating exchange rates, uncovered interest parity,and nominal wage rigidities is formulated. The transient and steady-state effects of a joint and unilateral monetary...