Crisis of the euro zone and prospects of the euro

This paper analyzes problems of the eurozone, which are aggravated by the crisis. It proposes architectural transformations of the European monetary system targeted at combating the crisis and promoting economic growth and employment in today’s structurally inhomogeneous Europe.     

Free entry in successive oligopolies

In the present paper, we propose an extension of Spengler's (1950) analysis of successive oligopolies, to study the effects of entry in the downstream and upstream markets. Free entry is analyzed using replica economies à la Debreu and Scarf (1963) . We find that free entry may have different effects in the upstream and in the downstream market. Namely, the usual convergence of the price to the corresponding marginal cost only occurs in the downstream market.     

Foreign Investors in The Netherlands: Heterogeneous Employment and Productivity Effects

Recent academic research suggests that the effects of inward foreign direct investment for productivity and employment may vary across foreign investors with different characteristics. Using a newly created dataset that integrates micro-level information from The Netherlands Foreign Investment Agency and Statistics Netherlands, this paper explores the role of several of these characteristics, including e.g. the country of origin, activities and tasks, age and strategic role of foreign affiliates in The Netherlands in the 2000–2007 period. Our analysis shows that important employment and productivity differences exist for nearly all these dimensions.     

Effects of Free Trade on Women and Immigrants: CAFTA and the Rural Dominican Republic

We construct a disaggregated rural economywide model with a focus on gender and immigration as well as on the allocation of time to wage work, household production activities, and housework (reproduction). We use this model to simulate the impacts of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) on rural incomes and welfare in the Dominican Republic. We find that elimination of agricultural import tariffs hurts both agricultural and non-agricultural households, via adverse factor-market effects, but impacts vary substantially by workers’ gender and country of origin. Females and Haitian immigrants tend to fare better than Dominican males, and there are ramifications for both market and non-market activities.     

Medical Malpractice Liability and Physician Migration

This paper uses national data on individual physicians and two control groups to provide evidence on the extent to which each of five medical malpractice reforms impacts the decision to move one's medical practice to another state. We find robust evidence that states that have implemented noneconomic damage caps experience less out-migration of physicians than states that do not have these reforms. In addition, we find some evidence that joint and several liability reforms and patient compensation funds also impact the migration decisions of physicians.     

Variety,Globalization, and Social Efficiency

The standard formal presentation of the Dixit‐Stiglitz‐Krugman (DSK) model of monopolistic competition with a constant‐elasticity‐of‐substitution (CES) utility function supposes a sufficient number of firms so that the elasticity of demand facing each variety is approximated by a constant elasticity of substitution. Such a formulation forces economies of scale to be frozen so that firm size never changes. We use a Bertrand‐Nash interpretation of the equilibrium that allows the elasticity of demand facing each variety to depend on the number of varieties, thus allowing the gains from globalization to reflect both the increase in variety and the exploitation of economies of scale. We also develop a precise expression for per capita real income with any number of sectors and examine the age‐old question of the socially optimal number of varieties.