This paper offers the rationale for presenting a particular type of Phillips curve and develops the dynamic behavior of an economy where such a Phillips curve relation is observed. The specific kind of relation that is explored has similarities with the sticky-information Phillips curve of the...

Asymmetries in cross-price elasticities have been demonstrated by several empirical studies, but received little attention by the theoretical literature. In this paper we study from a theoretical stance how introducing asymmetry in the substitution effects influences the sustainability of...

In this paper, we examine the ranking of the maximum-revenue tariff and the optimum-welfare tariff under a linear Cournot oligopoly model without and with free entry of domestic firms. We demonstrate that in a regulated entry oligopoly with asymmetric costs, when the marginal cost of the...

We study whether the institutional adoption of inflation targeting (IT) has constituted both a policy and a macroeconomic switch in Sweden using the nonlinear MSVAR technique. We assess the relative weight put on inflation in the monetary reaction function and the capacity of IT to reduce...

In this paper we consider a model of horizontal differentiation with a quite general production function and derive the closed form solutions for the level of the variables in the decentralized economy and in the social planner case. This enables us to analyze how consumers’ welfare varies in...

We analyze the effect of competition in market-accessibility enhancement among quality-differentiated firms. Firms are located in regions with different ex-ante transport costs to reach the final market. We characterize the equilibrium of the two-stage game in which firms first invest to improve...

This paper develops a multi-sector endogenous innovation model that is able to account for the dynamics of comparative advantage of each sector within the economy. The model in this paper assumes that two kinds of learning effects exist in R&D: advantages of backwardness and forwardness. It is...

This paper applies the Inverse Hyperbolic Sine (IHS) transformation to explore the variables that determine a firm’s R&D collaborative expenditure. The IHS specification is used to overcome the inconsistencies deriving from non-normality of error terms which are typical in censored data. This...

This paper presents a dynamic stochastic general equilibrium model with nominal rigidities, capital accumulation and finite horizons. Our New Keynesian framework exhibits intergenerational wealth effects and is intended to investigate the macroeconomic implications of fiscal policy, which is...

Using a two-country general equilibrium framework with heterogeneous agents and uncertainty, we examine how countries' adoption of different fundamental approaches to taxing international capital income will affect portfolio choices and pricing relationships in international bond and foreign...