In this paper we explore the extent of exchange rate pass-through for the USA, UK and Japan using a post-Bretton Woods industry-level dataset. We investigate how different channels of exchange rate pass-through affect domestic and import prices. Our analysis is suggestive of two channels of...

The "great divergence" between Europe and the rest of the world occurred relatively recently. What enabled Europe, with all its laggards, to dominate the previously successful Eastern economies? This article emphasizes one important mechanism, highlighting the contrast between the European...

We develop a political economy model of sovereign debt that shows that income inequality leads to popular pressures on the government to use foreign debt to finance a redistribution of income at the expense of productive public investment. Recognizing this fact, international lenders impose...