We examine whether financial systems facilitate efficient allocation of resources into perspective projects. Employing European micro-level data from 1996-2005, we show that firms in industries with the best growth opportunities use more external finance in financially more developed countries....

We assess the ability of health insurance plans with gatekeeping restrictions to control the utilization of medical care through their inuence on the choice of the initial provider. Empirical results are based on the individuallevel utilization panel data from 2001-2006 Medical Expenditure Panel...

The share of public investment relative to consumption expenditure has declined in past decades. Earlier literature has attributed this stylised fact variably to the relative political ease of cutting investment; different cyclical patterns of public investment and consumption; or to EMU’s...

Plott, Wit & Yang (2003) conduct a betting market experiment and nd: First, information was aggregated. This suggests that traders updated their private information based on observed market odds. Second, a model based only on the use of private information seems to fit their data best. The...

This paper studies the effects of a fully funded social security reform with endogenous fertility in a detailed, general equilibrium life-cycle model with dynasties whose members differ in skills and life uncertainty. We find that as high skill households tend to save relatively more in assets...

I show that in a private value multi-unit uniform-price auction, the reservation price increases both the efficiency and revenue. In equilibrium the difference between the true value of a unit and the submitted bid (shading) is different for each unit; therefore, the seller cannot allocate units...

The paper analyzes optimal monetary strategy and policy trade-offs in a DSGE model of an open economy with traded and non-traded sectors. We approximate the utility of the repre- sentative consumer to obtain a micro-founded quadratic loss function of the form extensively used for monetary policy...

We characterize the price discovery in three emerging EU stock markets—the Czech Republic, Hungary, and Poland—by employing high-frequency five-minute intraday data on stock market index returns and four classes of EU and U.S. macroeconomic announcements during 2004–2007. We account for...

In this paper we extend the analysis of optimal monetary policy rules in terms of stability of an economy, started by Evans and Honkapohja (2003b), to the case of heterogeneous private agents learning. Following Giannitsarou (2003), we pose the question about the applicability of the...

This paper analyzes the impact of equity market information imperfections on R&D driven growth. The mechanism proposed is built on two premises. First, the R&D-sector relies largely on equity finance, because of its production features. Second, equity can be persistently mispriced. This is due...