We analyse the behaviour of a multi-sector small open economy with involuntary unemployment due to fair wages. The equilibrium level of employment depends in an intuitively appealing way on the sectoral structure of the economy. It is shown that induced changes in employment are a driving force behind many of the comparative static results. Fair wage variants of the Heckscher-Ohlin and the Rica...

abstract research and development (r&d;) spending plays a major role in innovation, raising productivity and increasing economic growth. the purpose of this paper is to investigate the impact of r&d; spending on growth and total factor productivity (tfp) in iran's agricultural sector. we estimate growth and productivity models using auto-regressive distributed lag (ardl) approach and data over ...

Reliable measures of the size and direction of changes in monetary policy are very crucial for examining the effects of monetary policy on the economy. Monetary Condition Index (MCI) can be used as a tool to assess the stance of monetary policy. This index is defined as the weighted average of different monetary transmission mechanism relative to their values in a base period. The weights in MC...

This paper derives consistent standard errors for a panel Tobit model in the presence of correlated errors. The problem is framed in the context of Newey and West (1987), considering the Tobit model as a special case of a GMM estimator. JEL codes: C23, C24

We analyze the value of public information in a competitive endowment economy. We provide a global result that an early release of information about the future state of the economy is desired by all agents, or Pareto improving, if agents disagree about the prospect of the economy and asset markets are complete. We further prove that for certain levels of agents’ disagreement, all agents prefer ...

In this paper the optimal choice of a monetary target is investigated for a small open economy that is subject to foreign monetary policy shocks. In contrast to large parts of the literature, pegging the exchange rate is never the best policy choice for the small open economy in our model. Instead, monetary targeting and, depending on the parameter combination, producer price index targeting co...

This paper presents a simple model of the world economy, in which productivity gains in manufacturing are responsible for the global trend of manufacturing decline, and yet, in cross-section of countries, faster productivity gains in manufacturing do not necessarily imply faster declines in manufacturing. In doing so, it aims to draw attention to the common pitfall of using the cross-country ev...

Integrated assessment models lack a microeconomic foundation in modelling environmental damages to the economy. To overcome this, damage coefficients are incorporated in standard microeconomic models. Firms and consumers take both damages and prices as given. Demand, supply, profit and expenditure functions under damage coefficients are derived that allow easy implementation in applied economic...

This paper analyses alternative ‘regimes’ (i.e. profiles of opportunity sets for individuals) for an exchange economy, without assuming that individuals act on coherent preferences. A Strong Opportunity Criterion is proposed. This extends the requirements of McQuillin and Sugden’s (2012) Opportunity Criterion to every set of individuals in an economy. The concept of a ‘market-clearing single-pr...