The Origins and Evolution of the Double Account System: An Example of Accounting Innovation

The distinguishing characteristic of the double account system is the subdivision of the conventional balance sheet into a capital account and a revenue account, and it is the purpose of this paper to explain why it became the practice of railway companies to publish accounts in this form.     

Fiscal Activism and the Zero Nominal Interest Rate Bound

In an economy where the zero lower bound on nominal interest rates is an occasionally binding constraint and the government lacks a commitment technology, it may be desirable for society to appoint a policymaker who cares less about government spending stabilization relative to inflation and output gap stabilization than the private sector does. A policymaker of this type uses government spending more elastically to stabilize the economy. At the zero lower bound, the anticipation of aggressive fiscal expansions in future liquidity trap situations increases inflation expectations and lowers real interest rates, thereby mitigating the decline in output and inflation.     

Strategic Complementarity in the Dynamic Private Provision of a Discrete Public Good

Individual voluntary contributions to a discrete public good are shown to be strategic complements in a dynamic private provision game. This is in contrast to a public good that can take on any value in a continuum where they are strategic substitutes.     

Global Food Chains, African Smallholders and World Bank Governance

This paper critically examines the World Bank's analysis of the development of agribusiness in Africa in the World Development Report 2008 in relationship to its governance policies, which seek to introduce institutional reforms to promote private and public sector linkages with the participation of civil society. The paper argues that this confuses food chain governance (control over quality and the logistics of production) with democratic governance and essentially promotes oligopolization of the food industry and the interests of the powerful in the name of smallholder farmers.     

HOUSING WEALTH AND U.S. MONEY DEMAND: A PANEL ESTIMATION

This article estimates a panel model for U.S. money demand using annual state‐level data for the period from 1977 to 2008. We incorporate housing wealth in the demand‐for‐money function and find strong evidence of a relationship between a broad monetary aggregate and housing wealth. This finding is robust to the inclusion of variables measuring financial heterogeneity across U.S. regions. Breaking up the sample in two subperiods shows that panel estimates including housing wealth yield more stable coefficients than both time‐series estimates and panel estimates excluding housing wealth. We also show that the link between money and housing wealth predates the recent boom‐and‐bust cycle. (JEL E41, E52)     

DEBT CRISIS, TRADE LIBERALIZATION, STRUCTURAL ADJUSTMENT, AND GROWTH: SOME POLICY CONSIDERATIONS

This paper analyzes some dynamic aspects of trade liberalization reforms within the context of the debt crisis. In particular, the paper discusses issues concerning intensity of liberalization, speed of trade reform, and the interaction between liberalization and stabilization. It deals with analytical issues and draws from the empirical experiences of some highly indebted Latin American countries.     

Factor Endowments,Democracy, and Trade Policy Divergence

We develop a stochastic model of electoral competition in order to study the economic and political determinants of trade policy. We model a small open economy with two tradable goods, each of which is produced using a sector‐specific factor (e.g., land and capital) and another factor that is mobile between these tradable sectors (labor); one nontradable good, which is also produced using a specific factor (skilled labor), and an elected government with the mandate to tax trade flows. The tax revenue is used to provide local public goods that increase the economic agents’ utility. We use this general equilibrium model to explicitly derive the ideal policies of the different socioeconomic groups in society (landlords, industrialists, labor, and skilled workers). We then use those ideal policies to model the individual probabilistic voting behavior of the members of each of these socioeconomic groups. We use this model to shed light on how differences in the comparative advantages of countries explain trade policy divergence between countries as well as trade policy instability within countries. We regard trade policy instability to mean that, in equilibrium, political parties diverge in terms of the political platforms they adopt. We show that in natural resource (land)–abundant economies with very little capital, or in economies that specializes in the production of manufactures, parties tend to converge to the same policy platform, and trade policy is likely to be stable and relatively close to free trade. In contrast, in a natural resource–abundant economy with an important domestic industry that competes with the imports, parties tend to diverge, and trade policy is likely to be more protectionist and unstable.