Based on a sample of 104 countries, we document four key stylized facts regarding the interaction between capital flows, fiscal policy, and monetary policy. First, net capital inflows are procyclical (i.e., external borrowing increases in good times and falls in bad times) in most OECD and...

In his Inquiry into the Nature and Causes of the Wealth of Nations Adam Smith (1776) considered the phenomenon of division of labor so enormously significant for the creation of a nation’s wealth that he devoted the first three chapters of his book to an investigation of this process. This is...

The purpose of this paper is to analyze the dynamic response of a small subset of variables to exchange rate shocks by using a new method based on a set of theory-consistent sign restrictions for the purpose of identifying shocks over time (1995Q1–2019Q1) in the Moroccan economy. It is...

The recent discovery of the Ledenyov digital waves in the economies of scale and scope led to an origination of considerable scientific interest in the modeling of new types of the discrete-time digital signals generators for the business cycles generation in the macroeconomics. Article aims: 1)...

The recent discovery of the Ledenyov digital waves in the economies of scale and scope led to an origination of considerable scientific interest in the modeling of new types of the discrete-time digital signals generators for the business cycles generation in the macroeconomics. Article aims: 1)...

This paper analyses the importance of real wage rigidities, in particular through their interaction with price stickiness, for optimal monetary policy in a calibrated small open economy DSGE model including oil in production and consumption. Blanchard and Galí (2007a) show real rigidities to...

This paper investigates the optimal behavior of the main real macroeconomic variables in a Dynamic Stochastic General Equilibrium (DSGE) framework augmented with a time-varying depreciation rate of capital stock and an endogenous production of maintenance goods. For this purpose I explicitly...

A strict linear proportionality between the CPI inflation and the actual interest rate defined by the Board of Governors of the Federal Reserve System is studied. During the last 70 years, the cumulative CPI is just the cumulative interest rate times 1.37. There are periods when the Fed interest...

The argument made in this manuscript is that the two traditional macroeconomic tools, fiscal policy and monetary policy, are insufficient to bring back efficiently into equilibrium an economy that has had a major crisis. Both traditional macro-tools only work through the demand side, and there...

The sources of inflation are explained by different theoretical approaches in the framework of these theories and their basic assumptions. For this reason, prescriptions presented to reduce inflation are shaped according to the basic assumptions of theories. Naturally, the reasons for the...