Duverger claimed more than 50 years ago that the number of candidates in elections should be a function of electoral rules. Both his “law” and “hypothesis” suggest the number of candidates vying for seats in elections to be tightly linked to characteristics of the electoral process such...

As first argued in Sargent and Wallace (1981), under certain conditions a tighter monetary policy today might give rise to higher expected inflation if the public perceives that the worsened debt dynamics could end up in debt monetization. This channel is arguably stronger in countries featuring...

The impact of real exchange rate movements on GDP growth is a hotly debated issue both in policy and academic circles. In this paper, we provide evidence suggesting that the association between exchange rate misalignment and growth for a broad panel of countries is very weak. Controlling for...

In this short article we use a simple differences-in-differences technique to investigate whether bilateral correlation of business cycles increased more amongst members of the European Monetary Union (EMU) after the implementation of the Euro than amidst other OECD economies. We present...

This paper investigates what factors affect the duration of sudden stops in capital flows using quarterly data for a large panel of countries. We find that countries with floating exchange rate regimes tend to experience shorter sudden stop episodes and that fixed exchange rate regimes are...

Domestic savings and investment are positively correlated across countries and through time, as Feldstein-Horioka (FH) unveiled 40 years ago. We argue that an interpretation of this correlation based on market failures is more consistent with data patterns than alternative hypotheses. Moreover,...