Reserves and the managed float: a search for the essentials

We examine the stability of rules that determine the rate of devaluation as a function of the level of reserves; the analysis is conducted in terms of an overlapping-generations and a Sidrauski-type model with rational expectations and without capital mobility. On the whole, the analysis confirms results by Rodriguez (1981) in a substantially different model, by which ‘high’ speeds of adjustment tend to provoke instability.     

Fiscal policy,welfare, and employment with perfect foresight

The long-run feasibility of expansionary fiscal policy is analyzed in a “fix price” economy under the assumption that individuals are altruistic and have rational expectations. It is found that exclusive reliance on interest bearing debt is a feasible policy only if money is an inferior good. However, feasibility is ensured if the bonds to money ratio is not higher than a certain critical level.     

On dollarization

The paper examines the case for dollarization in emerging market economies. It is claimed that dollarization becomes an attractive monetary regime when account is taken of recent financial turmoil in such economies. The case is further strengthened by the fact that these economies have a penchant for acquiring dollar debts (i.e., liability dollarization). However, exchange rate misalignment and deflation are potentially serious problems, unless appropriate fiscal and public sector prices policies are implemented, in addition to establishing a financial sector whose assets and liabilities face parallel relative price risks. JEL classification: F31, F41     

Analyzing the Techno-Economic Determinants for the Repowering of Wind Farms

The aim of this article is to identify the relative importance of technical and economic variables in the financial feasibility of repowering wind farm projects. A financial valuation model is developed. We carry out a sensitivity analysis with several variables considered to be key in the repowering decision. The most relevant technical variable is the increase in production efficiency and the most relevant economic variable is the capital expenditures in new equipment. Furthermore, the decision to repower critically depends upon the level of support being provided. The repowering project would not be feasible in the absence of support.     

What Can the Developed World Learn from the Latin American Debt and Mexican Peso Crisis?

The global financial crisis of 2007–08 resulted from massive institutional failure and proved that a robust regulatory and supervisory frameworks are necessary. Such frameworks are not yet in place. This paper recounts the legacy of the financial crisis in the sovereign debt crisis in Greece as of September 2011. It then turns to comparing the current situation to those of Latin America, and especially Mexico, in the 1980s. It describes what was done to recover in Latin America and what lessons can and cannot be learned from those experiences in acting to assist the countries of the European Union threatened with sovereign debt default.     

Which workers get insurance within the firm?

Industry-level time series data suggest that low-skilled workers get less insurance within the firm than high-skilled workers. In particular, wages respond relatively more to productivity shocks in low-skilled industries than high-skilled industries. Our theory is that low-skilled workers get relatively less insurance from their firms because they have relatively lower displacement costs. Under limited commitment, lower displacement costs make the workers' outside options more attractive, and hence decrease the amount of risk sharing sustainable within the firm. Evidence on average displacement costs by industry support the theory's predictions.     

New perspectives for the managerial entrepreneurship

Is the purpose of this speech to build in an eclectic and holistic way the bases of a theoretical mark that it describes, analyze and do interpret the phenomenon of the managerial entrepreneurship from the interdisciplinary point of view in such a way that the foundation is to respond to the question how to understand the entrepreneurship?, to build starting from their evolution diverse perspectives that you/they enrich their analysis and study that make understand that the entrepreneurship is a practical, simple and complex phenomenon that the managers experience directly in their activities and functions, as a breaking act and improvement of the conditions of life of the society. It is sought to analyze and to propose perspectives of study of the entrepreneurship of the managers, their personal characteristics, as their social, political, economic and cultural implications, from the interdisciplinary point of view in the mark of the investigation line entrepreneurship and Managerial Mentality that he/she interprets their purpose action, administration, innovation and mainly their relationship with the environment, so momentous for the growth of the companies.     

The Value-added Content of Trade:New Insights for the US-China Imbalance

Trade in intermediate inputs accounts for roughly two-thirds of international trade.This input trade reflects the increasing fragmentation of production processes across borders.It also creates two distinct challenges for measuring international interdependence. First, conventional gross trade statistics tally the gross value of goods at each border crossing, rather than the net value added between border crossings. This well-known "double-counting" problem means that conventional data overstate the domestic value-added content of exports.Using input-output tables for individual G7 countries, existing estimates suggest that the import content of exports is 20%-30% and rising over time.Estimates for countries heavily engaged in processing trade (e.g.China) are on the order of 50%.     

Are High Interest Rates Effective for Stopping High Inflation? Some Skeptical Notes

High interest rates are considered an effective tool for stoppinghigh inflation. The case for a policy of high interest ratesis developed in terms of a conventional IS-LM model. However,among other things, the model ignores some central aspects ofmodern credit markets. In particular high interest rates maygive rise to nonperforming bank loans, thus seriously jeopardizingthe effectiveness of the policy. Examples are developed in whichit would be optimal to aim for equilibriums of low, rather thanhigh, interest rates. One of these examples hinges on the existenceof nonindexed domestic debt.     

Devaluation: Levels versus rates

In a context of infinitely-lived families à la Sidrauski, where consumers are lump-sum compensated for the inflation tax, and there is no capital mobility, it is shown that a devaluation improves while an increase in the rate of devaluation deteriorates the balance of payments.