On several occasions, the 1980s witnessed non-Keynesian effects of fiscal contractions. Most notably, cuts in government spending in Ireland, Denmark and Germany are known to have coincided with increases in private consumption spending. Self-fulfilling expectations about the effects of...

Standard trade theory claims that free trade is welfare-enhancing. We show that this is not the case if at least one sector of the economy is a Cournot oligopoly. In a simple small open economy with one oligopolistic and one competitive sector, welfare is an inverted U-shaped function of...

We study the Beaudry and Portier (2006)-hypothesis of delayed-technology diffusion and news-driven business cycles. For German data on TFP and stock prices we find qualitatively similar empirical evidence. Quantitatively, however, an impulse response analysis suggests that a substantial part of...

There are several candidate explanations for macro-fluctuations. Two of the most common discussed sources are surprise changes in disembodied technology and monetary innovations. Another popular explanation is found under the heading of a preference or more generally a demand shock. More...

The time series properties of German GDP have been re-examined in recent research. Extending the sample to include GDP data from 1950 onwards, some researchers argued in favor of a trend-stationary rather than difference stationary representation of real log GDP. I show that this conclusion is...

I suggest a concept of convergence stronger than [sigma]-convergence. This concept, [rho]-convergence, is equivalent to [beta]-divergence in reverse time and implies bounds for convergence speed of merely [sigma]-convergent economies. Empirically, the [rho]-concept detects divergence earlier...