Purpose: The purpose of this paper is to highlight the relation between the loan-to-value (LTV) ratio and the price-rent (PR) ratio. The paper intends to relate the PR-ratio to housing return and the potential for a leverage gain in housing investments by considering the funding structure of...

Purpose – The purpose of this paper is to highlight the importance of home equity and the interplay between market segments for housing market developments. The intention is to show that it is not only the aggregate equity gain but also the distribution of equity gains between segments that...

This paper analyses the relation between the structure of GDP and a country's debt sustainability. A two-sector model with endogenous relative sector sizes is developed to formally show that under certain conditions the debt sustainability, measured as the limiting value of the debt-to-GDP...

Do transition economies carry features distinct from those of mature economies? Exploring the relation between debt and inflation in mature and transition economies in a two-sector model with endogenous industrial structure, structural factors are shown to hinder achieving balanced performance...

Despite its strong theoretical position when it comes to explaining inflation in transition economies, the empirical findings of the Balassa–Samuelson (B–S) effect assign only a minor role to structural inflation – to the disappointment of analysts and policymakers. This article points to...

This paper presents a model for the pricing of exports that relates exchange rate pass-through to the planning horizon of firms. Exchange rate pass-through is often analysed assuming exporters have short horizons, even though a number of arguments can be applied for why longer horizons govern...

This paper comments on the industrial structure of developing countries' Export-Processing free Zones (EPZs). As developing countries are exposed to irrecoverable entry costs in international markets, the relationship between export supply and exchange rates has been shown to be persistent. In...

Housing markets tend to display positive serial correlation as well as considerable volatility over time. We present a heterogeneous agent model illustrating the connection between adaptive expectations and housing market fluctuations. A dwelling serves as a shelter, as a vehicle for investment...

This paper investigates the relevance of traditional trade-exchange rate theorems for developing countries facing sunk entry costs in international markets. Firstly, the theorems analysing pricing of tradable goods and the trade balance dynamics following exchange rate shocks are accounted for....