The paper shows that in a stylized model with two countries, characterized bydifferent levels of nancial development, the following facts can be replicated: 1)persistent current account surpluses and 2) high TFP growth in China. Because ofliquidity shocks and credit constraints, investment by...

This paper studies how liability dollarization conditions the effectof exchange rate exibility on growth. It develops a model with creditconstrainedrms facing liquidity shocks denominated in tradables while theirrevenues are both in tradable and nontradables. With frictions in the...

We examine active retail mutual funds and institutional products with a mandate to invest ininternational equity markets between 1991 and 2009. Using global and regional factor models,we find no reliable evidence of alphas in the aggregate or on average. The right tail of thedistribution...