Domestic absorption cycles are relevant in assessment and design of fiscal policies. Our cross-country analysis covers 59 advanced and emerging countries for the 1990-2009 period. We show that ignoring domestic absorption cycles leads to biased fiscal stance indicators, for both advanced and...

This paper examines the impact of the recent global crisis on emerging market economies (EMs). Our cross-country analysis shows that the impact of the crisis was more pronounced in those EMs that had initial weaker fundamentals and greater financial and trade linkages. This effect is observed...

The gain-loss ratio is known to enjoy very good properties from a normative point of view. As a confirmation, we show that the best market gain-loss ratio in the presence of a random endowment is an acceptability index and we provide its dual representation for general probability...

We consider the mechanism design problem of a principal allocating a single good to one of several agents without monetary transfers. Each agent desires the good and uses it to create value for the principal. We designate this value as the agent’s private type. Even though the principal does...

We examine the problem of setting optimal incentives for a portfolio manager hired by an investor who wants to induce ambiguity-robust portfolio choices with respect to estimation errors in expected returns. We consider a one-period model with a set of risky assets (with multivariate normal...

I document a previously unexplored substantial cost of initial public offerings (IPOs): patent lawsuits. I find that firms become targets of excessive patent lawsuits shortly before IPO completions, and the litigation intensity persists after firms become public. However, firms that withdraw...

I document a previously unexplored substantial cost of initial public offerings (IPOs): patent lawsuits. I find that firms become targets of excessive patent lawsuits shortly before IPO completions, and the litigation intensity persists after firms become public. However, firms that withdraw...