We analyze the impact of ...nancial globalization on asset prices, investment and the possibility of crashes driven by self-ful...lling expectations in emerging markets. In a two-country model with one emerging market (intermediate income level) and one industrialized country (high income level), we show that symmetric liberalization of capital out‡ows and in‡ows increases asset prices, investm...

In the late 1970s, industrial countries began moving toward full reliance on indirect instruments, such as open market operations, rediscount facilities, and reserve requirements. Many developing and transition economies have followed suit. Indirect instruments are more effective than direct instruments in today’s increasingly open economic environment. N IMPLEMENTING monetary policy, a central...

Working papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views stated herein are those of the authors and are not necessarily those of the Federal Reserve Bank...

This paper investigates the response of US stock market uncertainty to monetary policy of the Federal Reserve Bank. It can be shown that monetary policy signifi cantly Granger-causes stock market confi dence. By using monthly closing prices of the V IX as a stock market uncertainty proxy and a copula-based Markov approach the stable nonlinear relation between confi dence and uncertainty is demo...

In a deregulated electricity market such as the California WEPEX, spinning reserves must be explicitly identified as an ancillary service and priced. Additionally, scheduling coordinators who match suppliers and demands may either self-provide spinning reserves, or rely on the Independent System Operator (ISO) to provide reserves at the spot price. The deregulated market structure makes explici...

Working papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views stated herein are those of the authors and are not necessarily those of the Federal Reserve Bank...

This paper evaluates the effects of introducing labor market flexibility into a small open economy characterized by tenure-increasing separation taxes. The model, which is calibrated to Argentinean observations, is subjected to different reforms: 1) the elimination of all separation costs, 2) the introduction of temporary contracts, and 3) the elimination of the separation costs from all new hi...

Intellectual property protection involves a trade-off between the undesirability of monopoly and the desirable encouragement of creation and innovation. As the scale of the market increases, due either to economic and population growth or to the expansion of trade through treaties such as the World Trade Organization, this trade-off changes. We show that, generally speaking, the socially optima...

The views in this paper are solely the responsibility of the authors and should not be interpreted as reflecting the views of the Federal Reserve Bank of San Francisco or the Board of Governors of the Federal Reserve System. ABSTRACT A recent decline in internal migration in the United States may have been caused in part by falling house prices, through the " lock in " effects of financial cons...