The empirical performance of macroeconomic exchange rate models is more than disappointing. This dismal result is also reflected in the forecasting capabilities of professional analysts: all in all, analysts are not in a position to beat naïve random walk forecasts. The root for this deficient...

In a globalized economy, firms move production to other countries without turning a hair. A local policy maker who seeks to avert relocation faces a dynamic problem - incentivizing the firm to remain in its home country today does not guarantee that the firm also stays in the future. We...

A unilateral policy intervention by a country (such as the introduction of an emission price) can induce firms to relocate to other countries. We analyze a dynamic game where a regulator offers contracts to avert relocation of a firm in each of two periods. The firm can undertake a...

Intuition suggests that in markets with consumer lock-in (‘brand loyalty’), firms with a large customer base earn higher profits. We show for a homogeneous goods duopoly that the intuition can be misleading, as the intensity of price competition depends on the initial market split. We derive...

A relatively neglected aspect of sustainable development is the creation of an enduring built environment that can be adapted to suit changing circumstances. This presents a significant challenge: how to evaluate a building's adaptability. The premise is introduced that adaptability is enhanced...

The unilateral introduction of an emissions price can induce firms to relocate to other countries with less stringent environmental regulation. However, firms may be able to reduce the emissions costs in their home country by investing into low-carbon technologies or equipment (abatement...

H51, I13, J24 </AbstractSection> Copyright Ashley et al.; licensee Springer. 2014

H51, I13, J24 </AbstractSection> Copyright Dean et al.; licensee Springer. 2014