This paper attempts to provide a framework to explain both the lower share of current spending in large fiscal adjustments and the potential expansionary effects of fiscal contractions. We distinguish between current spending and productivity enhancing public investments and analyze the...

This paper attempts to provide a framework to explain both the lower share of current spending in large fiscal adjustments and the potential expansionary effects of fiscal contractions. We distinguish between current spending and productivity enhancing public investments and analyze the...

A poor country with volatile export prices borrows in international markets. When debt is denominated in foreign currency, there is a temptation to repudiate when export prices are low. Excusable partial defaults reduce this temptation, and help to support lending. The cases of debt denominated...

Four different schemes for classifying exchange rate regimes are compared for developing countries. Disagreements are substantial, and alternative schemes disagree as much with each other as with the official scheme. Only the official scheme shows a trend towards floating

Four different schemes for classifying exchange rate regimes are compared for developing countries. Disagreements are substantial, and alternative schemes disagree as much with each other as with the official scheme. Only the official scheme shows a trend towards floating

It is shown that convergence in inequality has been significantly slower amongst developing countries.

International migration affects equilibrium unemployment in a small open economy characterised by efficiency wages. Immigration into employment reduces unemployment rates, and immigration into unemployment increases them. The effect of emigration depends on its impact on the aggregate job...

Some theories predict that exchange rate bubbles should deflate faster than they inflate. We find no empirical support for this hypothesis for currencies that floated against the US dollar. The bursting of exchange rate bubbles is not analogous to collapses in the prices of financial assets....

It is shown that convergence in inequality has been significantly slower amongst developing countries.

A poor country with volatile export prices borrows in international markets. When debt is denominated in foreign currency, there is a temptation to repudiate when export prices are low. Excusable partial defaults reduce this temptation, and help to support lending. The cases of debt denominated...