The main purpose of this study is to examine a relationship between budget deficit and indirect taxes in political instability. Between 1985 and 2003, budget policies were influenced by unstable political conditions. In order to explain the financing of the budget deficits under the political...

Are expansions and recessions more likely to end as their magnitude increases? In this paper we apply parametric hazard models to investigate this issue in a sample of 16 countries from 1881 to 2000. For the total sample we find evidence of positive magnitude dependence for recessions, while for...

This research aims to comtribute to the discussion on the importance of theoretically consistent modelling for stochastic efficiency analysis. The robustness of policy suggestions based on inferences from efficiency measures crucially depends on theoretically well-founded estimates. The...

We present a model in Costly State Verification framework that relates capital raised in a firm to profitability. We explain how optimality of investment is affected by how the aggregate funding affects the expected outcomes of the project. Although we find underinvestment, the problem does not...

This paper uses annual data for the period 1952-2002 to investigate the inflationary process in Indonesia within the cointegration and Granger´s causality framework. The empirical results suggest that the consumer price index (CPI), the stock of narrow (M1) or broad money (M2) and real...