Smooth and stable commercial/business activities are the prime concern of every nation, as these activities decide the developmental routes of the economy. This study has examined the role of institutional development and policy mix in determining business freedom in developing countries....

The paper studies the short run and long run effects of a production subsidy to the tourism sector of a small open economy, which can also be thought as a region within a country. We introduce a two-sector dynamic general equilibrium model where the tourism sector is considered to be...

This paper is a discussion of the economic geography of Australia. It provides a history of foreign investment in mining, and discusses several resources booms that shaped the landscape of the continent and the role of governments (state, federal and territory governments) in this process. The...

When towards the end of 2008 the leading world economies found themselves in the grips of a severe global financial and economic crisis, their governments felt compelled to react. Most of them, especially in North America and Europe, did so by dramatic increases in government spending with two...

I study the relationship between political constraints and the probability of sovereign default on external debt using a dynamic stochastic model of fiscal policy augmented with legislative bargaining and default. I find that political constraints and default probability are inversely related if...

This paper explores the dynamics of the Greek public debt. It supports that, first, the public debt is unsustainable and, second, the reduction in government expenditures and the cut in unit labour costs in the private sector seems to be the only available, al-though too little too late...

This paper studies optimal monetary and fiscal policy in a small open economy. Two forces in the economy impose orthogonal restrictions on financing costs across governments. The first force requires constant financing costs across governments to have time consistent optimal policy of hours. The...

This paper seeks to analyse the determinants of capital flight in selected Latin American countries throughout the 1990s, and gives some insights into what economic policies would be adequate under capital flight conditions. Finding, empirically, the saving rate to be a new determinant of...

Recent research has demonstrated that while government expenditures are countercyclical in most industrialized countries, they tend to be procyclical in developing countries. We develop a dynamic political-economy model to explain this phenomenon. Simulations of the model allow us to...

Highly indebted developing economies commonly also hold large external reserves. This behavior seems puzzling given that governments in these countries borrow with an interest rate penalty to compensate lenders for default risk. Reducing debt to the same extent as reserves would maintain net...