Over the past thirty years, a great deal of business cycle research has been based on purely real models that abstract from the presence of nominal rigidities, and so (at least implicitly) assume that the Phillips curve is vertical. In this paper, I show that such models are fragile, in the sense that their implications change significantly when the Phillips curve is even slightly less than ver...

In this paper we present a basic but flexible macroeconomic framework with heterogeneous agents – households, firms, banks – which interact through a decentralized matching process presenting common features across four markets – goods, labour, credit and deposit. We study the dynamics of the model by means of computer simulation. Some macroeconomic properties emerge such as endogenous business...

The volatility of short-term capital flows (or ‘capital surges’) is now recognized as a major problem for macroeconomic management in developing countries; but the consequences for the ‘real’ economy that is, the behaviour of government, firms and households which subsequently translates into investment, growth, employment and welfare is less well understood. Short-term capital flow instability...

Norms of Persistent Homology introduced in topological data analysis are seen as indicators system instability, analogous to the changing predictability that is captured financial market uncertainty indexes. This paper demonstrates norms from markets significant explaining uncertainty, whilst macroeconomic only explainable by volatility. Meanwhile, volatility insignificant determination when en...

Abstract We develop a dynamic macroeconomic model with heterogeneous financial intermediaries and endogenous entry. Time-varying risk arises from the risk-shifting behaviour of cross-section intermediaries. When interest rates are high, decrease in stimulates investment decreases aggregate risk. In contrast, when they low, further stimulus can increase instability while inducing fall premium. t...

Ukraine and Russia together are called the “Breadbasket of Europe” important producers agricultural commodities. Russia’s invasion on has affected food supply chains forced manufactures to reshape their chain strategies as consumer behavior not only in specific region but also far away from conflict zone changed dramatically. This war direct indirect economic exposures globally, disruption glob...

Many recent papers have investigated whether data from internet search engines such as Google can help improve nowcasts or short-term forecasts of macroeconomic variables. These papers construct variables based on Google searches and use them as explanatory variables in regression models. We add to this literature by nowcasting using dynamic model selection (DMS) methods which allow for model s...

This paper analyzes the effects of financial market globalization on the crosscountry pattern of development in the world economy. To this end, it develops a dynamic macroeconomic model of imperfect credit markets, in which the domestic investment becomes borrowing-constrained at the lower stage of development. In the absence of the international financial market, the world economy converges to...