We show that capital controls have large adverse effects on misallocation, exports and welfare using a dynamic Melitz-OLG model with heterogeneous firms, monopolistic competition, endogenous trade participation and collateral constraints. Static effects increase misallocation by reducing...

This study examines changes in returns to formal education and cognitive skills over the past 20 years using the 1979 and 1997 waves of the National Longitudinal Survey of Youth. We show that cognitive skills had a 30%–50% larger effect on wages in the 1980s than in the 2000s. Returns to...

In contrast with recent research in monetary policy analysis which has featured a great deal of work concerning conditions for determinacy, I have argued in recent publications that least-squares (LS) learnability is a compelling necessary condition for a rational expectations (RE) equilibrium...