Using various indicators for economic freedom, it is shown that increases in economic freedom are robustly related to economic growth. This conclusion holds even if the impact of outlying observations is taken into account. The level of economic freedom is not related to growth.

This article examines how the impact of inflation targeting on inflation performance depends on the choice of country samples, adoption dates, time periods and methodological approaches. We apply two different estimation methods -- difference-in-differences and propensity score matching -- for...

Most recent cross-country studies on election-motivated fiscal policy assume that the data can be pooled. As various tests suggest that our data for some 70 democratic countries for the period 1970--2007 cannot be pooled, we use the Pooled Mean Group (PMG) estimator to test whether Political...

We test uncovered interest rate parity (UIP) using London InterBank Offered Rate (LIBOR) interest rates for a wide range of maturities. In contrast to other markets, LIBOR markets have minimal frictions. Whereas most previous studies reject UIP, we find that UIP holds for several short-term...

We examine the usefulness of communication by the European Central Bank for predicting its policy decisions during the early years of the European Economic and Monetary Union. Using ordered probit models based on the Taylor rule, we find that statements on the main refinancing rate and future...

Using a dynamic panel model for more than 15 000 banks from 148 countries from 1988 to 2010, we investigate the interaction between size, growth and profitability of banks. For our total sample, we cannot reject the hypotheses that the variability of bank profitability and the level and...