21 22 Abstract 23 24 Does the dollarization of liabilites and the resulting balance sheet vulnerability prevent 25 monetary policy from serving its conventional countercyclical role? We study this question 26 in a model of a small open economy in which domestic firms face an imperfect capital 27 w market, with risk premia depending on net worth as in Bernanke and Gertler Am. Econ. 28 Ž . x Rev....

This paper evaluates the relative importance of three contagion channels: direct trade, neighborhood effects and financial competition in banking centers. Because these channels are highly correlated, they could easily be confused. However, policy implications are very different depending on the channel and therefore disentangle which channels are more relevant is an important task. This paper ...

We draw on portfolio theory and international diversification in order to analyse strategies allowing to reduce emerging economies’ exposure to exchange-rate risk. We show in particular that it may be efficient for an investor, in terms of maximising the return-to-risk ratio, to build up a portfolio of emerging-country assets denominated in local currency unhedged against currency risk compared...

There are two leading views on how financial crises turn into recessions. The first view highlights the importance of a troubled banking sector that cannot provide credit to domestic firms. The second view stresses the relevance of short-term borrowing in foreign currency and the associated decline in net worth through a weak balance sheet. Both views underline the role of financial constraints...

RNA polymerase III recognizes and pauses at its terminator, an oligo(dT) tract in non-template DNA, terminates 3' oligo(rU) synthesis within this sequence, and releases the RNA. The pol III subunit Rpc11p (C11) mediates RNA 3'-5' cleavage in the catalytic center of pol III during pausing. The amino and carboxyl regions of C11 are homologous to domains of the pol II subunit Rpb9p, and the pol II...

Based on a classification of countries and territories according to their regime and anchor currency choice, the study considers the two major currency blocs of the present world. A nested logit regression suggests that long-term structural economic variables determine a given country’s currency bloc affiliation. The dollar bloc differs from the euro bloc in that there exists a group of countri...

In this paper we make use of the uncovered interest rate parity (UIRP) relationship to examine the extent that the liberalization of emerging financial markets has resulted in the integration of developing countries’ currency markets into the international capital market. Previous tests of the impact of liberalization on the integration of emerging markets capital markets into world financial m...

How does the central bank’s incentive to build a reputation affect speculators’ ability to coordinate and the likelihood of the devaluation outcome during speculative currency crises? What role does market information play in speculators’ coordination and the central bank’s reputation building? I address these questions in a dynamic regime change game that highlights the interaction between the...

Parrondo’s paradox [1–4] shows that the combination of two losing strategies can lead to a winning result. The paradox can be phrased in terms of very simple gambling games in which some unit (say, 1 euro) is won or lost with a given probability. We can imagine that the games consist on tossing different biased coins and that a “capital” C(t) is built. Every time a game is played (a coin is tos...