Showing papers in "Journal of International Economics in 1996"

TL;DR: The authors defined a currency crash as a large change of the nominal exchange rate that is also a substantial increase in the rate of change of nominal depreciation, and used a panel of annual data for over 100 developing countries from 1971 through 1992 to characterize currency crashes.

TL;DR: The authors developed a model of growth and technology diffusion which they fit to aggregate data from OECD countries and found that more than 50% of the growth in each country in their sample derives from innovation in the United States, Germany, and Japan.

TL;DR: The authors explored the relationship between wages and foreign investment in Mexico, Venezuela, and the United States Despite very different economic conditions and levels of development, they find one fact that is robust across all three countries: higher levels of foreign investment are associated with higher wages.

TL;DR: In this article, the authors re-examine deviations from PPP using a panel of 150 countries and 45 annual post WWII observations, and show strong evidence of mean-reversion that is similar to that from long time-series.

TL;DR: The root of Mexico's balance-of-payments crisis is found in the prevailing high degree of capital mobility and financial globalization as discussed by the authors, which may produce large imbalances between stocks of financial assets and foreign reserves, threatening the sustainability of currency pegs.

TL;DR: In this paper, the authors explore the extent to which the Mexican government's inability to roll over its debt during December 1994 and January 1995 can be modeled as a self-fulfilling debt crisis.

TL;DR: The authors examined the relationship between international trade and income convergence among countries by focusing on groups of countries comprising major trade partners and found that the majority of these trade-based groups exhibited significant convergence.

TL;DR: The multiplicity of equilibria is due to a coordination problem inherent in activities that require specialized inputs as mentioned in this paper, and if no intermediate inputs are presently produced, there may be little incentive for any single firm to do so on its own.

TL;DR: In this paper, the authors examine the choice between exporting, licensing, and acquiring a subsidiary in this environment, and describe the international equilibrium that jointly determines the pattern of specialization and the market mode.

TL;DR: In this article, the authors consider an environment in which ex-ante symmetric countries can form customs unions freely and show that the formation of customs unions improves the aggregate welfare of member countries but reduces the welfare of non-member countries.

TL;DR: In this article, an n -country n -commodity trade model was constructed to analyze the implications of the size of a trading bloc for Nash equilibrium tariffs and welfare. But the relationship between the absolute size of (symmetric) trading blocs and their market power is ambiguous, and this relationship varies with model parameters.

TL;DR: In this paper, the authors examined the effect of the Sematech Consortium on semiconductor firms' R&D spending, profitability, investment, and productivity by using Compustat data on all U.S. semiconductor companies.

TL;DR: In this article, the authors measured the openness of the advanced economies to trade with each other relative to the predictions of the monopolistic competition trade model using data on manufacturing trade and production in the OECD in 1985.

TL;DR: In the literature on speculative attacks on a fixed exchange rate, it is usually assumed that the monetary authority responsible for fixing the rate reacts passively to the monetary disruption caused by the attack as discussed by the authors.

TL;DR: In this article, the optimal unilateral policy for a country that imports a good from a neighbouring country and is harmed by pollution generated during the production of that good is considered, and it is shown that foreign regulation of pollution does not eliminate Home's incentives to intervene, but instead may create rent-shifting opportunities.

TL;DR: In this article, the authors argue that allowing for the possibility of a self-fulfilling panic helps to understand several features of the recent Mexican crisis and that the imperfect credibility of Mexican exchange rate policy made it advisable to follow more contractionary fiscal and monetary policies in 1994.

TL;DR: The authors decomposes fluctuations in industry output in a particular country into: (1) a nation specific shock, (2) an industry-specific shock; (3) a common shock; and (4) an idiosyncratic factor.

TL;DR: In this article, an endogenous growth model of a small open economy is developed, where the equilibrium growth rates of domestic capital and consumption are determined largely independently. But the latter part of the paper discusses optimal fiscal policy in a situation where the tax revenues are used to finance utility augmenting government expenditure.

TL;DR: This paper developed a model of an open economy in which the stock of human capital may be augmented by either imitation or innovation, and the model predicts convergence of growth rates, but not (necessarily) of per capita income levels, in the steady state.

TL;DR: In this paper, the authors examined the magnitude of the saving retention coefficient, b, in a setting of known near perfect capital mobility, Japanese regions and found that the estimate of b is negative.

TL;DR: In this paper, the authors characterize the evolutionary equilibria in both a parametric and a general model, and argue that corner equilibrium predominate for a firm's internal organization and that a less efficient mode can displace a more efficient mode when trade barriers are sufficiently low.

TL;DR: In this article, the authors evaluate the extent to which Mexican monetary policy in 1994 may have loosened, or not tightened sufficiently, in the lead up to the devaluation, using econometric models of money demand.

TL;DR: In this paper, a general equilibrium model for examining the individual as well as the joint effects of export requirements and local equity controls of multinational firms is presented. And the results suggest that for a small open economy under tariff protection, the desirable policy is 100% foreign ownership of subsidiaries, coupled with an export-share requirement.

TL;DR: In this paper, the authors developed a model in which a country faces a balance of payments crisis if constraints on its international borrowing bind, and compared the predictions of this theoretical example with events in Mexico from 1987 through 1995.

TL;DR: In this article, the welfare effects of eliminating non-tariff barriers (NTBs) when firms expand abroad via export or direct investment (DI) were examined and two broad categories of NTBs were considered according to whether they discriminate only against the foreign exporter (Type I) or also against the local subsidiary of the foreign-owned firm (Type II).

TL;DR: In this article, the authors show that a VIE that increases the market share of imports above the prevailing level results in higher prices in the domestic market, and that the effect of VIE on prices is independent of the level of import subsidies.

TL;DR: In this paper, the authors investigated the validity of real interest parity for long maturities across the US, Britain and Germany and found that there appears to be no tendency for expected real interest rates to be equalized over longer maturity.

TL;DR: In this article, the authors argue that the policy may be a rational response to fundamental contracting failures, their key assumption being that sellers are incompletely informed about buyers' valuations.

TL;DR: The authors explore liberalization of trade in differentiated commodities using a model featuring monopolistic competition and capital accumulation and identify a mechanism of cumulative causation in investment and an associated externality leading to under-accumulation.