In this paper an alternative mechanism to the stock market is proposed. Two elements are taken away: (1) middlemen, and (2) shareholder lack of involvement. Structural elements are identified. Equilibrium-stability conditions are defined. A measures of effectiveness is suggested.

This Paper explores the relationship between the Kydland-Prescott Barro-Gordon model and models with asymmetric policy preferences. While both yield an inflation bias, recession aversion dampens the output effects of contractionary supply shocks. Some inflation may therefore reflect policy...

In this Paper we estimate jointly a forward-looking reaction function for the three-month rate along with a term structure relationship linking the six-month interest rates to current and expected future three-month rates. In our empirical model the response of the six-month interest rates to...

Using stochastic simulations, this paper analyses the probability distribution of a country's deficit ratio under fixed exchange rates and a variety of monetary policy rules. The purpose is to show how the probability of getting an "excessive deficit", defined as a deficit / GDP ratio in excess...

We test how government revenue and expenditure depend on economic activity, elections, and ideology. We show how the use of fiscal forecasts makes it possible better to understand the determinants of fiscal variables and to separate fiscal policy rules from discretionary policies. The approach...