The ERM crisis of 1992 appears to be due to a series of negative output shocks followed by devaluation. This stylised fact does not seem to conform to the “second-generation “ crisis model based on the REH. We show that by adopting bounded rational learning, the model yields a tradeoff between the size and persistence of shocks leading to devaluation, a finding which makes the model more clearl...

Abstract In “Racial Integration and the Problem of Relational Devaluation,” I argue that blacks should reject racial integration on self-protective solidarity grounds. will intensify self-worth harms stigmatization phenotypic devaluation by leading to more fully internalize their devaluation, while integrating process itself might reduce former, it may well leave in place latter. this paper, re...

We investigate whether foreign ownership shields firms from liquidity constraints following a financial crisis. Recent crises in East Asia, Latin America, and Russia have been characterized both by large currency devaluations and widespread collapse of the banking sector. Although a currency devaluation should increase exporters’ competitiveness and investment, a collapsing banking system may d...

Habits are notoriously difficult to break and, if broken, are usually replaced by new routines. To examine the neural basis of these characteristics, we recorded spike activity in cortical and striatal habit sites as rats learned maze tasks. Overtraining induced a shift from purposeful to habitual behavior. This shift coincided with the activation of neuronal ensembles in the infralimbic neocor...

Devaluation presents one of the therapist's most difficult challenges: conducting therapy and managing resistance with patients who force the therapist into very aggressive and uncomfortable experiences. When these situations arise, the therapist has a twofold task. He or she must tolerate the transference so as not to engage in a countertransferential enactment. Additionally, from this vulnera...

The present study investigates human aversive Pavlovian-to-Instrumental Transfer (PIT) and possible influences of outcome devaluation and instrumental overtraining on this effect. PIT measures the extent to which a Pavlovian conditioned stimulus (CS) can increase instrumental responses independently paired with the same (outcome-specific transfer) or a different (general transfer) reinforcer. T...

Research has shown that psychopathic individuals ignore information that is outside their goaldirected focus of attention. When affective information is goal-irrelevant, ignoring it results in a blunted affective response for psychopathic individuals. In cognitive science, though, an interesting phenomenon named inhibitory devaluation occurs in the context of neutral information. When neutral i...

This paper builds a simple theoretical model designed to study dollarization. Each period, a benevolent government decides whether or not to dollarize, how much to borrow or lend on an international bond market, and, if dollarization has not occurred, the devaluation rate. In equilibrium, international borrowing is limited endogenously such that the government always chooses to repay when the p...