Abstract Many existing studies have found a correlation between inflation and price dispersion in goods markets. In this paper, we document that a similar correlation can be found in equity markets. We estimate the correlation between overall price changes and dispersion in the NYSE and in the...

Abstract The Soviet Union was competing head to head with market economies in the generation of new technologies, not only in traditional industries such as steelmaking, electricity, and machineries, but also in high tech-areas such as synthetic materials and microelectronics. Yet its...

Abstract We present a simple multiple equilibria model that incorporates the functioning of crony capitalism. We find that a government which is keen to support the interests of the élite is ready to stand the risk of a bank run since this is part of an equilibrium where investments are heavily...

Abstract This paper presents a two-country non-scale Schumpeterian endogenous growth model with interindustry North-South trade and wage rigidity in the North. Its purpose is to analyze the effects of a compression of the wage structure and an increase in unemployment benefits on Northern...

Abstract I present new estimates of the elasticity of substitution between capital and labor using data from the private sector of the U.S. economy for the period 1948-1998. I first adopt Berndt's (1976) specification, which assumes that technological change is Hicks neutral. Consistently with...

Abstract Interest-rate smoothing is traditionally attributed to the gradual adjustment of monetary policy to shocks. Rudebusch (2002) argues that smoothing can also arise spuriously if an autocorrelated variable is incorrectly excluded from the estimated reaction function. This paper presents a...

Abstract In this paper we use a modified neoclassical business cycle model to test two competing explanations of the expansion of the 1990s. The model can have indeterminate, multiple equilibria that give rise to expectation-driven business cycles. We fit into the model series of estimated...

Abstract Labor productivity comoves strongly with output, leads output and employment, and is only weakly correlated with employment. Procyclical productivity is observed in virtually all countries and industries, and it is observed even in periods of fluctuations due to pure demand shocks, such...

Abstract This paper fills an important gap in the literature on determinacy and existence of sunspot equilibria in stochastic linear self-referential models. The results in this paper demonstrate that heterogeneity in expectations may alter a model's regions of determinacy. We show how to...

Abstract In comparison to the standard literature on inequality and growth which assumes the former to be exogenous, we formulate a model in which inequality and growth are both endogenous. Long-run distribution, at least locally, is shown to be independent of the initial distribution of factor...