This paper seeks to understand the interplay between banks, bank regulation, sovereign default risk and central bank guarantees in a monetary union. I assume that banks can use sovereign bonds for repurchase agreements with a common central bank, and that their sovereign partially backs up any...

We study a new data set of dividend derivatives with maturities up to 10 years across three world regions: the US, Europe, and Japan. We use these asset prices to construct equity yields, analogous to bond yields. We decompose the equity yields to obtain a term structure of expected dividend...

Many statistical applications require an estimate of a covariance matrix and/or its inverse. When the matrix dimension is large compared to the sample size, which happens frequently, the sample covariance matrix is known to perform poorly and may suffer from ill-conditioning. There already...

Under what conditions does cost-of-service regulation lead firms to distort costs? This paper analyzes changes in fuel procurement practices by coal- and natural gas-fired electricity generating plants in the United States following state-level legislation that ended cost-of-service regulation...

This paper analyses the relative position of the Western Balkan countries (ex-Yugoslavia countries and Albania) in comparison to more advanced European economies in the context of possible further EU enlargement. First, the question of convergence between Western Balkan countries and the EU-15...

The article aims to empirically validate three questions. Have productivity differences in European manufacturing been increasing or diminishing and what has been the situation in Central and Eastern Europe countries? Are productivity differences homogenous over time and across manufacturing...

This paper explores the Moldovan exchange rate policy puzzle: why the country has pursued a soft peg to the US dollar, despite the virtual absence of direct trade with the United States, increasing “euroisation” of the economy, and an inflation-targeting monetary policy regime. In an attempt...

This paper presents evidence of the significant impact of structural similarities on business cycle synchronization. Using Sala-i-Martin’s methodology (1997a; 1997b), proven correlation coefficients of structural shares are offered as robust determinants of business cycle synchronization. The...

The article estimates the stock market wealth effects in Russia and Ukraine and attempts to determine whether institutional differences between Russia and Ukraine and both non-EU and EU Eastern European countries can explain differences in the significance and magnitudes of their wealth effects....

Preferences for redistribution have been shown to depend upon individual and institutional characteristics. Previous studies have demonstrated that those who have lived under a socialist regime favor more redistribution even after the regime changes. This paper tests a similar hypothesis based...