This article identifies the leaders, the supporters and the resisters of public service reform. It adopts a principal–agent framework, comparing reality with an ‘ideal’ situation in which citizens are the principals over political policymakers as their agents, and policy-makers are the principals over public service officials as their agents. Reform in most developing countries is complicated b...

Post-Cold War financial sanctions utilization reached its peak as policymakers employed used them in order to face address major international crises. Their prominence among foreign policy instruments sparked the interest of many scholars and enriched existing literature. However, their attractiveness raises several interesting research questions, such "Do targeted suffice achieve defined objec...

During the Asian financial crises, interest rates were raised immediately, and then reduced sharply. We describe an environment in which this is the optimal monetary policy. ∗Northwestern University and Tilburg University. †Northwestern University, and NBER. ‡International Monetary Fund. §Braggion thanks the European Central Bank-Research Department for its hospitality. Christiano is grateful f...

Following the financial crisis of 2007-2008, a deep analogy between the origins of instability in financial systems and complex ecosystems has been pointed out: in both cases, topological features of network structures influence how easily distress can spread within the system. However, in financial network models, the details of how financial institutions interact typically play a decisive rol...

Executive Summary Currency crises tend to be regional. Since macroeconomic and financial phenomena are not regional, these phenomena are unimportant in understanding why crises spread. But international trade is regional, as countries tend to trade with their neighbors. This suggests that trade links are important in understanding how currency crises spread, above and beyond any macroeconomic p...

Among the many reasons that may limit the adoption of promising reform ideas, policy capacity is the least recognized. The concept itself is not widely understood. Although policy capacity is concerned with the gathering of information and the formulation of options for public action in the initial phases of policy consultation and development, it also touches on all stages of the policy proces...

The financial liberalization in the four Nordic countries (Denmark, Finland, Norway, and Sweden) that took place mostly in the 1980s led to a major financial crisis in three of those countries. The crises in Finland, Norway, and Sweden are among the deepest financial crises in advanced market economies since World War II. Denmark experienced some banking problems but managed to avoid a systemic...

In this article we provide a summary of empirical results obtained in several economics and operations research papers that attempt to explain, predict, or suggest remedies for financial crises or banking defaults, as well as outlines of the methodologies used. We analyze financial and economic circumstances associated with the US subprime mortgage crisis and the global financial turmoil that h...