If foreign aid undermines institutional development, aid recipients can exhibit the symptoms of “dependence”-a short-run benefit from aid, but increasing need for aid that is damaging in the long run. We show that this high-aid/weakinstitutions state can be an equilibrium outcome even when...

The relationships between inflation and macro-economic instability are discussed analytically, using a simple monetary model with rational expectations, with an application to the case of Madagascar. The recent macroeconomic history of this country suggests that high inflation is correlated with...

We model an oppressor aiming at victimizing an excluded group in his country, with two main variants. A foreign power affects his behaviour using either conditional aid, subject to the dictator's participation constraint, or the threat of sanctions, broadly defined, subject to the credibility...

A simple game-theoretic model is first presented to bring out the conditions for terrorist organizations to choose to perpetrate their attacks in a host country other than at home. This emphasizes the diluted impact of counter-terrorism measures implemented in the host-country on the number of...

This paper tries to reconcile the observed fact that suicide-terrorists have a relatively high education level with rationality. It brings out the conditions under which potential students choose to acquire some education in a rational-choice model where this yields a non-zero probability of...

Somaliland has recently developed an unexpected democracy after seceding from chaos-ridden Somalia, while turning its port of Berbera into a success story, competing successfully with the long established ones in the Horn of Africa. A simple game-theoretic model is used to explain why the...

[eng] In efficiency wage theory, the wage premium is used as an incentive to resolve the productive efficiency problem due in particular to incomplete information. Generally supervision is exogeneous and cannot be used as an incentive device by the firm to monitor work effort. In this paper a...

[fre] Le cours parallèle de la naira a chuté peu de temps après la dévaluation du franc CFA en 1994. On construit un modèle théorique simple montrant comment ces deux événements sont probablement reliés, et on présente un test économé­trique allant dans ce sens. [eng] The parallel...

[fre] L'offre de cultures commerciales en économie de pénurie. . Le rôle stimulant de l'offre d'intrants et de biens de consommation sur la production agricole est désormais reconnu. Cet article présente un modèle qui considère les trois situations possibles : celle de rationnement, celle...

[eng] Macroeconomic impact of commercial policy in disequilibrium. Jean-Paul Azam. Four fixprice equilibrium regimes appear with the introduction of imported intermediate goods. Firms behaviour is different in each of them. In a particular sense, labour and intermediate inputs can be substitutes...