In this paper we examine how separation of ownership and control evolves as a result of an initial public offering (IPO) and how the underpricing of the issue can be used by insiders to retain control. Using data from a sample of 69 IPOs in the United Kingdom, we argue that IPO underpricing is...

This paper looks at Austria's pattern of development and its lessons for Eastern Europe. Austria's development path is characterized by three features. In the post-war era Austria was among the countries with the fastest convergence rate. At the same time Austria's movement up the technological...

Recent years have seen a major structural break in trade relations between West European countries and the former Eastern bloc. Austria experienced a disproportionately large bilateral trade creation with these countries. In this paper we take a closer look at the impact this trade growth has...

We examine the extent to which developing countries that do little, if any, research and development themselves benefit from R&D that is performed in the industrial countries. By trading with an industrial country that has large `stocks of knowledge' from its cumulative R&D activities, a...

In this paper we analyse the underlying causes behind Spanish unemployment which is now at 24%. We interpret this unfortunate outcome as the result of a series of adverse shocks, compounded by disinflationary policies and by a flawed system of labour market institutions. Our aim is to explain...

The viability of a fixed exchange rate system is shown to be state- or shock-dependent. We show, simply, Obstfeld's claim that there may be multiple equilibria - multiple shock values for which a regime switch becomes optimal. We distinguish between self-fulfilling and history-dependent crises....

In the years following the influential article of Poole (1970), many central banks reoriented their operating procedures to focus more on interest rates and less on monetary aggregates. The rapid restructuring of global financial markets was thought to have led to instability in standard...

The historical record suggests that economic development is associated with the rise of the financial sector. This rise is often triggered by exogenous events such as large budget deficits generated by wars or the availability of large investment projects such as railroads. This paper discusses...

This paper considers the impact on trade of preferential arrangements in Europe since the 1950s. Using a first difference version of the gravity model, we find that the EEC and EFTA altered the pattern of international trade. We also find evidence of trade diversion in several cases, notably...

Using two standard location models, we investigate price competition and divergence from optimal product differentiation when consumer preferences are influenced by the number of consumers purchasing the same brand or shopping at the same store. Negative network effects tend to lessen...