A two-step approach is used to assess the extent to which the credit crunch in East Asia was supply- or demand-driven. The results for Thailand suggest that the contraction in bank lending that accompanied the crisis was the result of supply factors.Agenor, Aizenman, and Hoffmaister propose a...

House prices in Europe have shown diverging trends, and this paper seeks to explain these differences by analyzing three groups of countries: the quot;fast lanequot;, the average performers, and the slow movers. Price movements in the first two groups are found to be driven mostly by income and...

This paper evaluates the macroeconomic and welfare effects of extending the averaging period used to calculate pension benefits in a pay-as-you-go system. It also examines the complementarities between reforms extending the averaging period and those increasing the retirement age under...

This paper develops a model to estimate the effects of export subsidies on the supply of exports. Using data for Costa Rica over the 1980`s, it is shown that while the export subsidy scheme in operation led to an increase in exports, the direct fiscal costs of the scheme were quite large....

This paper examines the extent to which the Japanese asset price cycle of the 1980s was determined by monetary factors, the real business cycle, and financial liberalization. Strong evidence is found of a shift in the relationships between monetary factors and land price inflation in the early...

This paper provides preliminary econometric evidence suggesting that the traditional trade-based business cycle linkages between the North and the South have changed. Many countries in the South, in particular in Asia, appear to have become more resilient to cyclical movements in the North, and...

This paper compares business cycles in Asia and in Latin America using structural vector autoregression analysis with panel data. The evidence for countries in these regions suggests that (i) the main source of output fluctuations is supply shocks, even in the short run; (ii) the real exchange...

How will the world-wide decline in real interest rates associated with global aging affect small open economies (SOEs) with aging populations? Lower interest rates will result in higher capital-labor ratios and increased wages; higher wages, in turn, will be passed on to pension benefits,...

Ageacute;nor and Aizenman analyze the implications of inefficient financial intermediation for debt management using a model in which firms rely on bank credit to finance their working capital needs and lenders face high state verification and enforcement costs of loan contracts. Their analysis...

When households face the possibility of borrowing constraints in bad times, favorable movements in the permanent component of the terms of trade may lead to higher rates of private savings. Agenor and Aizenman examine the extent to which permanent terms-of-trade shocks have an asymmetric effect...