We model the political process as consisting of voting on the issue considered salient, public expenditure, with a subsequent consensus over size of government and income taxation. We prove that for each majoritarian choice there is a unique consensus policy on progressivity and government size....

This paper examines the impact of ethnic divisions on conflict. The empirical specification is informed by a theoretical model of conflict (Esteban and Ray, 2011) in which equilibrium conflict intensity is related to just three distributional indices of diversity: ethnic polarization, ethnic...

Although economic inequality has long been viewed as a cause of civil conflict, existing research has not found robust empirical support for this relationship. This study explores the connections between inequality and civil conflict by focusing on the mediating role of ethnic identity. Using...

A new parametric minimum distance time-domain estimator for ARFIMA processes is introduced in this paper. The proposed estimator minimizes the sum of squared correlations of residuals obtained after filtering a series through ARFIMA parameters. The estimator is easy to compute and is consistent,...

The statistical properties of inflation and, in particular, its degree of persistence and stability over time is a subject of intense debate and no consensus has been achieved yet. The goal of this paper is to analyze this controversy using a general approach, with the aim of providing a...

A novel approach to analyzing real exchange rate (RER) persistence and its sources is presented. Using highly disaggregated data for a group of EU-15 countries, it is shown that the distribution of sectoral persistence is highly heterogeneous and skewed to the right, so that a limited number of...

This paper proposes a new time-domain test of a process being I(d), 0 d = 1, under the null, against the alternative of being I(0) with deterministic components subject to structural breaks at known or unknown dates, with the goal of disentangling the existing identification issue between...

This paper investigates the time series properties of partisanship for five political parties in Spain. It is found that pure fractional processes with a degree of integration, d, between 0.6 and 0.8 fit the time-series behaviour of aggregate opinion polls for mainstream parties quite well,...

This paper analyses the behaviour of a Wald-type test, i.e., the (Efficient) Fractional Dickey-Fuller (EFDF) test of I(1) against I(d), d1, relative to LM tests. Further, it extends the implementation of the EFDF test to the presence of deterministic trending components in the DGP. Tests of...