The perceptions of a central bank's inflation aversion may reflect institutional structure or, more dynamically, the history of its policy decisions. In this paper, we present a novel empirical framework that uses high-frequency data to test for persistent variation in market perceptions of...

Standard international economic models with life cycle/permanent income consumption behavior predict that international portfolio diversification leads to high bilateral consumption correlations. Thus international consumption correlations have been empirically estimated as a test of...

This paper presents a new method for empirically testing predictions of various political business cycle theories by using duration analysis. We estimate the effect of presidential elections and their outcomes on the likelihood of the occurrence of business-cycle turning points in the United...

The impermanence of fixed exchange rates has become a stylized fact in international finance. The combination of the "mirage" view that pegs do not really peg with the "fear of floating" view that floats do not really float generates the conclusion that exchange rate regimes are, in practice,...