This paper applies revealed preference theory to the nonparametric statistical analysis of consumer demand. Knowledge of expansion paths is shown to improve the power of nonparametric tests of revealed preference. The tightest bounds on indifference surfaces and welfare measures are derived...

This paper introduces a framework for analyzing the role of financial factors as a source of stability in small open economies. Our basic model is a dynamic open economy with a tradeable good produced with capital and a country-specific factor. We also assume that firms face credit constraints,...

This paper presents a simple model of currency crises which is driven by the interplay between the credit constraints of private domestic firms and the existence of nominal price rigidities. The possibility of multiple equilibria, including a 'currency crisis' equilibrium with low output and a...