Search

Adolescence has been highlighted as a period when environments are critical for the human capital development of women, and thus of their children, but evidence on this from low- and middle-income countries is scarce. We estimate the effect of mother adolescent undernutrition on offspring growth and development from infancy through adolescence using data from Ethiopia, India, Peru, and Vietnam and Instrumental Variables (IV) estimation that employs rainfall shocks during mother’s adolescence as instruments for mother’s nutritional status. We find a positive and significant effect of mother adolescent nutritional status on child height-for-age in infancy that persists through to adolescence and evidence that this may manifest mainly through a biological channel. Our results also support a significant impact of rainfall shocks during mother’s early adolescence on mother’s adult height and child growth from infancy to adolescence. We find no significant effect of mother’s adolescent nutritional status and rainfall shocks during mother’s adolescence on child achievement tests scores, however.

This paper employs a new definition of urban areas as functional economic units developed by the OECD in collaboration with the European Union to investigate the size and sources of productivity disparities across urban areas in Great Britain. We use data from the UK Annual Survey of Hours and Earnings and the UK Labour Force Survey between 1997 and 2010 and a two-step estimation procedure that accounts for bias in the extent of agglomeration economies arising from individual sorting and area fixed unobservables. Our results suggest that doubling the population of a city in Great Britain, would, on average, increase city productivity by 1%. The magnitude of these estimates appear much smaller than those in the literature and suggests that previous studies from the UK that adopt urban area definitions based on strictly administrative boundaries may exaggerate the extent of agglomeration economies.

This paper presents the most comprehensive and up-to-date panel data set of invoicing currencies in global trade. It provides data on the shares of exports and imports invoiced in US dollars, euros, and other currencies for more than 100 countries since 1990. The evidence from these data confirms findings from earlier research regarding the globally dominant role of the US dollar in invoicing – despite the comparatively smaller role of the US in global trade – and the overall stability of invoicing currency patterns. But the evidence also points to several novel stylised facts. First, both the US dollar and the euro have been increasingly used for invoicing even as the share of global trade accounted for by the US and the euro area has declined. Second, the euro is used as a vehicle currency in parts of Africa, and some European countries have seen significant shifts toward euro invoicing. And third, as suggested by the dominant currency paradigm, countries invoicing more in US dollars (euros) tend to experience greater US dollar (euro) exchange rate pass-through to their import prices; also, their trade volumes are more sensitive to fluctuations in these exchange rates.

We consider a two-player game of war of attrition under complete information. It is well- known that this class of games admits equilibria in pure, as well as mixed strategies, and much of the literature has focused on the latter. We show that if the players’ payoffs whilst in “war” vary stochastically and their exit payoffs are heterogeneous, then the game admits Markov Perfect equilibria in pure strategies only. This is true irrespective of the degree of randomness and heterogeneity, thus highlighting the fragility of mixed-strategy equilibria to a natural perturbation of the canonical model. In contrast, when the players’ flow payoffs are deterministic or their exit payoffs are homogeneous, the game admits equilibria in pure and mixed strategies.

We assess the empirical validity of the trilemma (or impossible trinity) in the 2000s for a large sample of advanced and emerging market economies. To do so, we estimate Taylor-rule type monetary policy reaction functions, relating the local policy rate to real-time forecasts of domestic fundamentals, global variables, as well as the base-country policy rate. In the regressions, we explore variations in the sensitivity of local to base-country policy rates across different degrees of exchange rate flexibility and capital controls. We find that the data are in general consistent with the predictions from the trilemma: Both exchange rate flexibility and capital controls reduce the sensitivity of local to base-country pol- icy rates. However, we also find evidence that is consistent with the notion that the financial channel of exchange rates highlighted in recent work reduces the extent to which local policymakers decide to exploit the monetary autonomy in principle granted by flexible exchange rates in specific circumstances: The sensi- tivity of local to base-country policy rates for an economy with a flexible exchange rate is stronger when it exhibits negative foreign-currency exposures which stem from portfolio debt and bank liabilities on its external balance sheet and when base-country monetary policy is tightened. The intuition underlying this finding is that it may be optimal for local monetary policy to mimic the tightening of base-country monetary policy and thereby mute exchange rate variation because a depreciation of the local currency would raise the cost of servicing and rolling over foreign-currency debt and bank loans, possibly up to a point at which finan- cial stability is put at risk.

We test for the empirical relevance of partial and asymmetric dominant-currency pricing (DCP), the hypothesis that large but not necessarily identical shares of economies’ export and import prices are sticky in US dollar. We first set up a structural three-country New Keynesian dynamic stochastic general equilibrium model which nests DCP, producer-currency pricing and local-currency pricing. Under partial and asymmetric DCP, the output spillovers from shocks that appreciate the US dollar decline with an economy's export-import US dollar pricing share differential, i.e. the difference between the share of an economy's export and import prices that are sticky in US dollar. Underlying this prediction is variation in an economy's net exports in response to US dollar appreciation that arises because the shares of export and import prices that are sticky in US dollar are different. We then provide evidence that this prediction from partial and asymmetric DCP is consistent with the data in a sample of up to 45 advanced and emerging market economies for the time period from 1995 to 2018. We moreover document that our findings are robust to considering US demand, US monetary policy and exogenous exchange rate shocks as a trigger of US dollar appreciation, zooming in on the responses of economies’ exports and imports, as well as to accounting for the role of commodity trade in US dollar invoicing.

These lecture notes provide an introduction to dynamic public good provision games. These games can be used to model situations in which a group of agents collaborate to complete a project, or computer scientists developing open source software, or individuals contributing to a fundraising campaign. These notes are targeted to advanced masters' of doctoral students.