We provide a theoretical framework to analyse the response of life time maximizing consumers to intertemporal prices of non-durable goods and durable goods when the borrowing limit depends on the market value of the stock of durables owned by the consumer. We use pseudo panel data on purchases...

Recent studies of border effects have focused on the intra-country and inter-country comparison of trade flows. It is found that borders have a negative impact on the size of cross-border trade. In order to estimate border effects on a regional level one needs not only data on inter-country but...