Just when China’s leaders receive conflicting signals of “overheating” and “below-potential growth”, they encounter tremendous external pressure to revalue the Renminbi (RMB) substantially. Our conclusion is that the major macroeconomic challenges have their roots in China’s...

This paper analyzes sequential games of double-sided Bertrand competition in the deposit and credit markets, when banks are free to reject customers and cannot distinguish among borrowers. The timing of competition is crucial when customers apply once. Interest rates are pushed upwards when the...

Egypt accelerated its ongoing transition from a public sector dominated economy to a private sector led and market oriented economy after the collapse of oil prices in the mid-1980s. Some aspects of the economy, such as trade policy, have been substantially transformed since then whereas other...

In this paper, we reexamine the question "Why doesn't capital flow from rich to poor countries?" posed, most recently, by Lucas (1990). We build a simple contracting framework where costly intermediation together with an adverse selection problem have quantitatively important effects on capital...

An overlapping generations model with two production factors and two types of agents is considered in presence of …nancial intermediation. The research focuses at the analysis of the consequences of a suddain negative production shock on a …nancial intermediation capacities and consequently...

Asymmetry in views of depositors and bankers can generate failures of financial intermediation in linking creditors and borrowers, and/or result in excessively high interest rates. Instead of considering asymmetry in assessment of the banks' solvency, this paper focuses on asymmetry in views as...

The paper focuses on a comparison of bank-based andmarket-based …nancial systems with respect to their ability to smooth the negative consequences of a macroeconomic shock. The model describes a two-market OLG economy with two types of agents (workers and entrepreneurs) and a financial system...

It is proposed to consider the business cycle as hysteresis loop with fluctuating limiting points. Concept is based on the Method of System Potential, (Proceedings of International System Dynamics Conference 2003, No.56) which describes dynamics of spontaniously arising Complex Systems as the...

This paper introduces an upgraded version of MSVARlib, a Gauss and Ox- Gauss compliant library, focusing on Multivariate Markov Switching Regressions in their most general specification. This new set of procedures allows to estimate, through classical optimization methods, models belonging to...

The extraction of a common signal from a group of time series is generally obtained using variables recorded with the same frequency or transformed to have the same frequency (monthly, quarterly, etc.). The statistical literature has not paid a great deal of attention to this topic. In this...