structural causes and regime consequences regimes as intervening variables international regimes are defined as principles norms rules and decisionmaking procedures around which actor expectations converge in a given issue area as a starting point regimes have been conceptualized as intervening variables standing between basic causal factors and related outcomes and behavior there are three views about the importance of regimes conventional structural orientations dismiss regimes as being at best ineffectual grotian orientations view regimes as an intimate component of the international system and modified structural perspectives see regimes as significant only under certain constrained conditions for grotian and modified structuralist arguments which endorse the view that regimes can influence outcomes and behavior regime development is seen as a function of five basic causal variables egoistic self interest political power diffuse norms and principles custom and usage and knowledge

how integrated are the money market and the bank loans market within the european union abstract this paper estimates cointegration vectors of the time series of money market interest rates and bank lending rates the study includes six member countries of the european union eu and covers a period of 10 years from 1985 to 1994 during this period significant steps were taken that intensified financial integration in the eu including the free flow of capital a system of stable exchange rate parities and the implementation of a single market for banking services we conclude that the domestic money markets are closely linked but the domestic banking markets are segmented preliminary investigation of international differences in the capital structure of firms on the one hand and of domestic business cycle conditions on the other hand do not seem to explain differences in bank spreads across countries the results point to other directions presumably to local market power and to differences in the role of lender monitoring

after hours stock prices and post crash hangovers after hours pricing in foreign equity markets of multiple listed u s securities appeared to be efficient in predicting new york prices in the weeks immediately following the october 1987 crash but relatively uninformative in succeeding months by contrast daily changes in new york prices appear to be efficiently incorporated in after hours trading on both the tokyo and london exchanges throughout the sample period this paper suggests that the asymmetry and temporal variations in cross market correlations are consistent with rational investor behavior in equity markets with nonzero transaction costs and time varying share price volatility in the wake of the october 1987 crash a number of studies have provided evidence of significant international linkages among national equity markets where high frequency movements in the share price indices of national exchanges appear to induce sympathetic price movements in subsequent trading on other national exchanges however the cross market correlations are generally much larger in periods of extreme volatility and appear to subside to modest or even negligible associations during periods of more normal trading activity since the constituent stocks of national exchange indices are not identical it may be that the episodic increases in correlated movements of the indices are due to changes in the actual or perceived relative importance of common factors in periods of unusual volatility the thrust of this paper is to remove the issue of the disparate composition of the price indices of national exchanges by examining the prices of a set of

regime decay conflict management and international organizations 1945 1981 this article updates earlier work by haas butterworth and nye on conflict management by international organizations in addition it seeks to answer the question of whether one can fruitfully interpret conflict management as a case of regime growth and regime decay for this purpose i develop indicators of regime coherence and regime effectiveness and illustrate them by subjecting the management of disputes to time series analysis the discussion identifies when and under what global conditions the regime began to decay finally i explain that decay in terms of four mutually supportive hypotheses in this article i thus offer a statistical history of the conflict management functions of the united nations and the major regional organizations and use it to probe the limits of the utility of the regime literature

purchasing power parity in the long run a cointegration approach this paper utilizes cointegration analysis to examine purchasing power parity relationships over a long time horizon the results indicate that the exchange rate is cointegrated strongly with the wholesale price index ratio and somewhat weakly with the consumer price index ratio the cointegrating coefficient between the exchange rate and the price ratio is close to one when cointegration is confirmed the hypothesis that the real exchange rate follows a random walk is rejected in most cases finally a new test for common trends finds no such common trends in exchange rates or price ratios copyright 1990 by ohio state university press

institutional impact of gatt an examination of market integration and efficiency in the world beef and wheat market under the gatt regime many studies have been done concerning the impact of the general agreement on tariffs and trade gatt on economic activities such as production consumptions trade and prices this study examines whether gatt reforms improved market integration and efficiency using the beef and wheat markets as specific cases whereas earlier studies specified general or partial equilibrium structure in their models this study uses time series methods with minimum structural specification the author suggests there is consistent evidence that gatt reforms promoted market integration and improved market efficiency

is the real interest rate parity condition affected by the method of calculating real interest rates although the real interest rate parity rirp hypothesis has been extensively tested there are no conclusive findings we argue that the mixed findings are a result of the different methods used to calculate the real interest rate in this article we examine whether the rirp holds for four oecd countries using five different methods for computing the real interest rate the results indicate that the connection between real interest rates tends to be sensitive to the computational method of the real interest rate thus authors have to be careful when comparing results across existing studies since the type of computational method might be responsible for differences in conclusions of the validity of the rirp

measuring international capital mobility a review many barriers to the international movement of capital across national boundaries have been dismantled over the course of the last 20 years financial integration was greatly enhanced by the removal of capital controls on the part of the united states germany canada switzerland and the netherlands after 1973 the recycling of surpluses to developing countries through the euromarkets in the 1970 s the removal of capital controls in the united kingdom and japan beginning in 1979 financial integration among european community countries including france and italy in preparation for 1992 recent moves toward financial liberalization in smaller countries in the pacific and the steady process of technical and institutional innovation that has proceeded around the world some popular tests of international capital mobility however appear to show anomalous results martin feldstein and charles horioka upset conventional wisdom in 1980 when they concluded that changes in countries rates of national saving had very large effects on their rates of investment and interpreted this finding as evidence of low capital mobility the argument

a disequilibrium model with smooth regime transitions and a keynesian spillover for switzerland s labor market abstract this paper presents a disequilibrium labor market model in which aggregation over a continuum of micro markets with different demand supply ratios produces smooth macro relationships mapping aggregate demand and supply onto actual employment and regime proportions aggregate labor demand consists of a classical part derived on a putty clay assumption and a keynesian spillover from the goods market the specification of labor supply incorporates intertemporal substitution the degree of aggregate imbalances on labor and goods markets is measured by business survey data the estimated model indicates a growing mismatch between the micro structures of demand and supply of labor the short run fluctuations of employment are primarily traced back to the keynesian spillover classical determinants of labor demand are relevant as well but only in the medium term labor supply is rather inert and thus absorbs the swings of labor demand only partly

hegemonic stability theory and 19th century tariff levels in europe although the theory of hegemonic stability has attracted an impressive array of adherents current formulations leave many conceptual issues unresolved existing formulations also fail to draw from the theory any implications concerning the process by which a hegemonic state creates and maintains a regime as an example great britain is generally agreed to have been hegemonic in the nineteenth century but britain s behavior was generally inconsistent with that implied by a theory of hegemonic stability i advance an alternative set of explanations for changes in international tariff levels based on the notion of a political business cycle

volatility spillovers across international swap markets the us japan and the uk abstract this paper examines volatility spillovers across the three major international swap markets namely the us japan and the uk we apply a multivariate var egarch model by incorporating the slope of term structure and corporate spread variables to capture the time varying nature of swap spread volatility across countries our empirical findings show that the changes in the swap spreads are significantly influenced by the slope of term structure variable in all three currencies we find that the us swap market has a major influence on the japanese and uk swap markets but not vice versa we also find that reciprocal spillovers exist between japanese and the uk swap markets in almost all cases the degree of volatility persistence is fairly strong and in many cases we find asymmetric volatility spillovers across maturity and country

regime linkages in the us uk real exchange rate real interest differential relation abstract using a multivariate regime switching framework and focusing on the period 1921 2002 which is characterized by different nominal exchange rate regimes and monetary regimes we find supportive evidence of the us uk real exchange rate real interest differential relation in terms of volatility regime dependence the two variables are jointly characterized by high volatility during periods of floating exchange rates and by low volatility during periods of fixed exchange rates thereby suggesting that the nominal exchange rate regime is the driving force behind the volatility regime switching thus allowing for regime switching in the real exchange rate real interest differential relation bridges the gap between popular theories of real exchange rate determination which predict such a relation and previous empirical studies which failed to uncover such a relation for the us uk real exchange rate

global and country specific movements in real effective exchange rates implications for external competitiveness abstract using the bayesian factor model we decompose real effective exchange rates which are considered a measure of external competitiveness into global and country specific factors among several findings we report a particular global trend in real exchange rates but a substantial proportion of their variation is found to be country specific in line with this finding we find that structural shifts when they do exist are contained in country specific factors furthermore consistent with economic theory this global factor is closely related to a trend in the global interest rate while country specific factors are closely related to idiosyncratic movements in the countries own interest rates such a decomposition results in better understanding of the exchange rate interest rate relationship and therefore our results can be interpreted as evidence that external competitiveness is heterogeneous among countries and that economic policies can influence countries competitiveness

is there a connection between monetary unification and real economic integration evidence from regime switching stationarity tests abstract we investigate the extent of real convergence among g7 economies in terms of long run real interest parity a novel approach is applied where unit root tests of real interest differentials are embedded within a markov regime switching framework whereas standard univariate unit root tests provide little support for parity we find real convergence is present after allowing for regime switches in real interest misalignments however differentials across members of the euro zone are likely to exhibit greater persistence despite nominal convergence it is non sequitur to infer from monetary unification that nominal convergence is necessarily conducive to real interest realignments or preventive of misalignments

convergence of real capital market interest rates evidence from inflation indexed bonds this paper investigates the convergence of long term ex ante real interest rates rirs obtained from canadian french uk and u s inflation indexed government bonds in contrast to previous research our evidence suggests full convergence in the long run and hence capital market integration for the same sample period global convergence is rejected for rirs measured in conventional terms from these results we conclude that previous tests of the long run real interest rate parity might have suffered from weak measurement of real capital market interest rates

mean reversion in the real interest rate and the effects of calculating expected inflation we investigate the measured persistence in the real interest rate using a variety of methods to annualize inflation and calculate the real rate results from a battery of conventional unit root tests yield conflicting conclusions for the various real rates adding to an existing confusion regarding mean reversion both long memory and exponential smooth transition autoregres sive models estar nonlinearity are considered as possible alternatives and in contrast to the unit root test results we find highly robust evidence against the unit root null based on the empirical results monte carlo analysis is performed to study the disparate results obtained using fractional integration and unit root tests

international human rights a regime analysis after laying out a typology of international regimes eight international and regional human rights regimes are analyzed in order to 1 examine the utility of regime analysis in noneconomic issue areas and 2 assess the nature extent and evolution of international cooperation on human rights there has been a remarkable growth of international action since 1945 when human rights were not even widely accepted as a legitimate issue area this growth can be explained largely by expanding perceptions of moral interdependence and community increased national commitment the growing ideological appeal of human rights and changes in the distributions of international power these same factors however suggest only limited future growth on a broader theoretical plane the case of human rights suggests a significant if limited and principally heuristic utility for regime analysis especially to the extent that international relations is becoming increasingly concerned with specific issues

structural unemployment and disequilibrium abstract in this paper we present a disequilibrium model of the labor market which allows us to distinguish cyclical unemployment due to wage rigidity from structural unemployment this is done through the insertion in the exchange condition of an aggregate disequilibrium model of variables measuring mismatch between disaggregated labor supplies and labor demands such a model also allows unemployment and job vacancies to coexist the model is estimated using canadian quarterly data from 1966 to 1983 our results imply that structural unemployment due to inter industrial shocks while significant is fairly small

coordination and collaboration regimes in an anarchic world the study of regimes can contribute to our understanding of international politics only if regimes represent more than international organizations and less than all international relations the conceptualization of regimes developed here accepts the realist image of international politics in which autonomous self interested states interact in an anarchic environment yet there are situations in which rational actors have an incentive to eschew unconstrained independent decision making situations in which individualistic self interested calculation leads them to prefer joint decision making regimes because independent self interested behavior can result in undesirable or suboptimal outcomes these situations are labeled dilemmas of common interests and dilemmas of common aversions to deal with these states must collaborate with one another or coordinate their behavior respectively thus there are different bases for regimes which give rise to regimes with different characteristics coordination is self enforcing and can be reached through the use of conventions collaboration is more formalized and requires mechanisms both to monitor potential cheating and to insure compliance with the regime the article elucidates the assumptions of such an interest based approach to regimes assimilates alternative explanations into this framework and develops the implications for regime maintenance and change

are real interest rates equal across countries an empirical investigation of international parity conditions this paper conducts empirical tests of the equality of real interest rates across countries the empirical evidence strongly rejects the hypothesis of real rate equality and the joint hypotheses of uncovered interest parity and ex ante relative ppp or the unbiasedness of forward rate forecasts and ex ante relative ppp the evidence suggests that it is worth studying open economy macroeconomic models which allow 1 domestic real rates to differ from world rates 2 time varying risk premiums in the forward market or 3 deviations from ex ante relative ppp the relationship of real interest rates across countries is of central importance to our understanding of open economy macroeconomics in some models where there is costless international arbitrage in goods and financial assets real interest rates for comparable securities should be equal across countries this has been a feature of much of the early research in the monetary approach to exchange rates e g frenkel 11 and bilson 2 on the other hand finance theory indicates that risk premia may well differ for comparable securities denominated in different currencies solnick 27 roll and solnick 26 stulz 28 fama and farber 7 hansen and hodrick 17 and dornbusch 6 and more recent theoretical models in the exchange rate literature such as dornbusch 5 frankel 10 and mussa 24 depend on real rates differing between countries in the short run the proposition that real rates are equal across countries is worth studying

cointegration market integration and market efficiency abstract this paper uses a standard dynamic general equilibrium asset pricing model to study the relationship among the concepts of efficient markets integrated markets and cointegrated prices within this setting we show that these concepts are independent of one another and any zero one two or three of these characteristics can emerge in equilibrium depending upon taste endowment and technology parameters in particular the results of tests of cointegration among asset prices have no implications about market efficiency or market integration without additional restrictions on the economy or economies

capital market integration in the pacific basin region an impulse response analysis abstract we examine the extent of capital market integration in a group of pacific basin countries following the deregulation of their markets and explore whether the financial influence of japan in the region has overtaken that of the us looking at long run comovements of real interest rates through the use of cointegration and using impulse response analysis to examine the speed of adjustment of real interest rates to long run equilibrium following a shock in one of the markets which is another indicator of the degree of capital market integration we find that these countries are closely linked with world financial markets and more so with japan than with us

the demand for international regimes international regimes can be understood as results of rational behavior by the actors principally states that create them regimes are demanded in part because they facilitate the making of agreements by providing information and reducing transactions costs in world politics increased interdependence among issues greater issue density will lead to increased demand for regimes insofar as regimes succeed in providing high quality information through such processes as the construction of generally accepted norms or the development of transgovernmental relations they create demand for their own continuance even if the structural conditions such as hegemony under which they were first supplied change analysis of the demand for international regimes thus helps us to understand lags between structural change and regime change as well as to assess the significance of transgovernmental policy networks several assertions of structural theory seem problematic in light of this analysis hegemony may not be a necessary condition for stable international regimes past patterns of institutionalized cooperation may be able to compensate to some extent for increasing fragmentation of power

trading human rights how preferential trade agreements influence government repression a growing number of preferential trade agreements ptas have come to play a significant role in governing state compliance with human rights when they supply hard standards that tie material benefits of integration to compliance with human rights principles ptas are more effective than softer human rights agreements hras in changing repressive behaviors ptas improve members human rights through coercion by supplying the instruments and resources to change actors incentives to promote reforms that would not otherwise be implemented i develop three hypotheses 1 state commitment to hras and 2 ptas supplying soft human rights standards not tied to market benefits do not systematically produce improvement in human rights behaviors while 3 state commitment to ptas supplying hard human rights standards does often produce better practices i draw on several cases to illustrate the processes of influence and test the argument on the experience of 177 states during the period 1972 to 2002 i would like to thank mike colaresi dan drezner david lake lisa martin walter mattli john meyer mark pollack erik voeten jim vreeland and two anonymous reviewers for their detailed and thoughtful comments on various drafts of this manuscript as well as the many other people who have helped me by asking hard questions along the way i would also like to thank michael barnett charles franklin and jon pevehouse for advice during the dissertation research that supports this article and alexander h montgomery for assistance in data management all faults are my own for generous assistance in the collection of data i thank the national science foundation ses 2cdz414 and ses 0135422 john meyer and francisco ramirez for support during the writing of the article i thank nuffield college at oxford university and most importantly lynn eden and stanford s center for international security and cooperation

real interest rate equalization some empirical evidence from the three major world financial markets this article examines the linkage of real interest rates of the three major world financial markets usa japan and the uk with the use of cointegration methods unlike previous works the investigation uses a trivariate vector autoregressive var model in which a constant term in the common stochastic trends space is excluded based on data generated after the liberalization of japan s foreign exchange market at the end of 1980 1981 1 1998 12 the article finds some empirical evidence indicating that the extent of the departure from the long run real interest rate equalization rie is not very large although the null hypothesis of the long run rie is rejected in most cases

real interest rate equalization and the integration of international financial markets abstract this paper argues that conventional regression tests of real interest rate equality may be misleading because they neglect to consider transactions costs a transactions cost band may inhibit the one to one correspondence between changes in real rates in alternative countries that is presumed by conventional tests statistical problems which may lead to incorrect inferences in conventional tests are also discussed alternative tests which overcome these limitations are developed and applied to real interest rates for ten different countries the alternative tests generate much stronger support for interest parity than is found in the existing literature

the real interest rate a multi country empirical study how real interest rates behave over time is critical to our understanding of many macroeconomic issues and much recent research has pursued this question very little of the research however has focused on real interest rates outside the united states this paper is an empirical exploration of real interest rate movements in seven oecd countries from 1967 ii to 1979 ii further research is needed on real rates in other countries for several reasons not only are measures of foreign real rates of interest in their ownright but extending an analysis of real rates to other countries also has the following additional benefits it can generate more powerful statistical tests of propositions previously tested on u s data and yield information on whether results found for the u s hold up in other countries this study pursues several questions that have arisen naturally from this earlier work is the hypothesis that the real rate is constant rejected when the analysis is extended to other countries does the real rate decline with increased inflation and money growth in other countries besides the united states how reliable is the fisher effect in which nominal interestrates reflect changes in expected inflation are movements in nominal interest rates a reliable indicator of movements in real rates what kind of variationsin real interest rates are there in different countries have real rates declined from the 60s to the 70s for other countries besides the u s this abstract was borrowed from another version of this item

labor utilization and nonwage labor costs in a disequilibrium macro framework the literature on labor utilization and nonwage labor costs is extended to incorporate recent approaches to macroeconomic disequilibrium modeling based on the smoothing by aggregation principle this leads to a reformulation of the basic sneessens dreze type model by treating employment and working hours as separate inputs the inclusion of nonwage labor costs serves a double purpose first they represent a restriction in the profit maximizing process and second they serve as a proxy for the fixity of labor the results differ substantially from simulation studies that disregard the utilization of labor and the nonlinear structure of labor costs

effects of shorter hours on employment in disequilibrium models abstract in this paper the employment effects of a wage compensated and non compensated reduction of standard working time are examined in the context of disequilibrium theory in disequilibrium models with exogenous working time noncompensated shorter standard hours increase employment in both regimes keynesian and classical unemployment wage compensation reduces the employment response at a regime dependent rate if working time is endogenized by taking into account overtime effects the employment response of shorter hours is positive in keynesian unemployment and negative in classical unemployment wage compensation increases the employment effect in the keynesian regime and decreases it in the classical regime a model is presented that allows for hours as well as capital stock adjustment and integrates non competitive price setting

regime dynamics the rise and fall of international regimes the dynamics of international regimes are treated as social institutions how and why do regimes arise from the interactions of individual actors over time three developmental sequences are identified and the resultant regimes are described as spontaneous orders negotiated orders and imposed orders how do regimes change once they have become established in specific social settings three major types of pressure for regime change arise from internal contradictions shifts in underlying power structures and exogenous forces the next task in studying the dynamics of international regimes is to seek a more sophisticated understanding of the factors determining the incidence of these developmental sequences and pressures for change

business and the international human rights regime a comparison of un initiatives this article argues that the extension of the international regime of human rights to companies has not changed the essentially state centric nature of the regime the analysis focuses on three recent united nations initiatives 1 norms on the responsibilities of transnational corporations and other business enterprises with regard to human rights 2 the global compact and 3 the work of the un special representative on business and human rights the analysis shows that despite these initiatives states are the primary holders of human rights obligations and have a key role in the decision making and enforcement of the regime companies have participated to the regime but they have done so mainly through lobbying governments and thus enforcing the role of states the analysis also shows that the engagement of new actors to decision making about the extension of regime norms is essential for norm adoption finally the issue of non compliant companies needs to be resolved before the regime can be considered established

the origins of human rights regimes democratic delegation in postwar europe the e ftieth anniversary of the un universal declaration on human rights marks an appropriate moment to reconsider the reasons why governments construct international regimes to adjudicate and enforce human rights such regimes include those established under the european convention for the protection of human rights and fundamental freedoms echr the inter american convention on human rights and the un covenant on civil and political rights these arrangements differ from most other forms of institutionalizedinternational cooperation in both their ends and their means unlike international institutions governing trade monetary environmental or security policy international human rights institutions are not designed primarily to regulate policy externalities arising from societal interactions across borders but to hold governments accountable for purely internal activities in contrast to most international regimes moreover human rights regimes are not generally enforced by interstate action although most arrangements formally empower governments to challenge one another such challenges almost never occur the distinctiveness of such regimes lies instead in their empowerment of individual citizens to bring suit to challenge the domestic activities of their own government independent courts and commissions attached to such regimes often respond to such individual claimsby judging that the applicationof domestic rules or legislationviolates international commitments even where such legislationhas been

term premiums and the integration of the eurocurrency markets abstract this paper provides comparative evidence on the time variation of expected returns across the term of eurocurrency markets first it is shown that forward spot spreads contain substanial information about future changed in 1 month to 5 year rates both in the eurodollar and eurodm markets next a latent variable model is constructed with different benchmark portfolios across currencies integration implies that the time variation of the benchmark portfolios must be the same across currencies little evidence is found against integration of the eurocurrency markets jel g15 g12

benchmarking the expectations hypothesis of the interest rate term structure an analysis of cointegration vectors i test cointegration restrictions that are consistent with the expectations hypothesis of the term structure by employing the full information maximum likelihood methods developed by johansen yield curves appear to be the result of cointegration among interest rates the cointegration vectors that best describe the long term impact of interest rate levels on interest rate changes can often be written as linear combinations of interest rate spreads there is however difficulty in keeping short term yields in such a restricted cointegrated system with other interest rates short term speculative returns from long term bonds do not conform to the expectations hypothesis

the real debt resistance hypothesis and persistence of unemployment in the oecd countries according to friedman 1968 p 10 unemployment above the natural rate should sooner or later lead to deflation and an accelerating deflation at that as table 1 shows until the mid 1980s the course of movement of the rate of unemployment and inflation in the oecd countries is in conformity with this hypothesis however since the mid 1980s and in spite of continuing high unemployment the rate of inflation remained at a significantly positive level there is certainly not evidence of accelerated deflation as predicted by friedman the most popular explanation offered is the possibility of presence of the hysteretic tendencies in the nairu three famous models in this respect are the insider outsider hypothesis of blanchard and summers 1986 the capacity constraint hypothesis of sneessens and dreze 1986 and the declining search effectiveness long term unemployment hypothesis of layard nickell and jackman 1991 all these explanations rely on the real wage rigidity as table 1 shows however the rigidity of real wages seems to be more due to the downward rigidity of the rate of growth of nominal wages and prices for example the average weekly earnings of the production workers in the us manufacturing sector has steadily increased since 1946 1 thus contrary to the dominant view in the new keynesian school see gordon 1990 what needs to be explained is the long term downward rigidity of nominal wages

a discussion of belgian unemployment combining traditional concepts and disequilibrium econometrics with a gdp of less than 100 billion and exports of more than 60 billion belgium comes perhaps closer than any other country to being a small open economy consequently trends in world trade and export performance have a major impact on domestic activity whereas the impact of domestic fiscal policy is damped by import leakages table 1 presents a few figures confirming these observations

the internationalization of money and finance and the globalization of financial markets abstract in this paper i combine long multi country time series data for interest rates and stock returns with the institutional evidence for much earlier centuries amassed by economic historians to study the question of financial globalization and how it has altered since the late classical era at their longest for dutch and english short term interest rates the quantitative data that i use extend back slightly more than three centuries the institutional history provides information on an additional millennium s worth of experience the conclusion that i reach is that the internationalization of money and finance and the globalization of financial markets are not new phenomena they are part of an evolutionary process that began much earlier and that has continued albeit with periodic interruptions and reversals for many centuries what we see today is simply the latest and most advanced manifestation of this process

cost and income based measures of human capital human capital is increasingly believed to play an important role in the growth process however adequately measuring its stock remains controversial in this paper three general approaches to measurement are identified cost based income based and educational stock based this survey focuses on the first two approaches and provides a critical review of the theories and their applications to data from a range of countries particular emphasis is placed upon the work of jorgenson and fraumeni 1989 1992 and some new results for new zealand based upon their approach are also presented

some evidence on the international inequality of real interest rates abstract this paper undertakes econometric tests of the hypothesis that ex ante real interest rates are equal across countries with highly integrated capital markets the issue is of practical importance because the violation of real rate equality is a necessary condition for monetary policy to influence the open economy through the real interest rate channel although an empirical literature concerning real rate equality already exists previous investigators have focused on pre tax real rates this paper contributes to the literature by attempting to incorporate the effects of taxation into the analysis

accounting for unemployment a labour market perspective i examine whether prolonged high unemployment in canada can be attributed to various structural causes rather than to demand deficiency as found by macro econometric models the answer is largely negative neither the dispersion of sectoral growth rates nor excessive and rigid real wages can convincingly account for most unemployment contentions to the contrary are based upon inappropriately partial analyses enduring shifts in industrial structure have if anything been declining labour mobility is high much unemployment lasts too long to be frictional fuller quantitative understanding of the nature of unemployment can be achieved only in a more general framework

transactions costs and covered interest arbitrage theory and evidence the extent to which deviations from covered interest parity can be attributed to transactions costs has been exaggerated in the economic literature because the swap market in foreign exchange has been ignored it is shown that such deviations should be no greater than the lowest of the transactions costs in one of three markets the swap market or either of the two relevant securities markets this reconciles the theory with the data which show spreads of no more than a few basis points however the empirical results have no direct bearing on the conventional market efficiency hypothesis

capital accumulation and unemployment a tale of two continents in contrast to much recent work regarding the causes of european unemployment in this paper we emphasize the importance of capital accumulation but unlike the few previous studies which have examined the relationship between capital accumulation and unemployment we argue that what matters for the evolution of employment and the unemployment rate is not the absolute growth rate of a country s capital stock but its evolution relative to other countries capital stock the empirical validity of the above statement is demonstrated for almost all oecd countries using quarterly time series data for the period 1961 1995 more detailed evidence is also presented for germany japan and the united kingdom

on the alternative explanations of persistence of unemployment in the oecd countries this paper begins with a summary statement of a few relevant facts about the worsening state of unemployment since the mid 1970s in the oecd countries a joint statistical test of the hypotheses of the natural rate hysteresis and the persistence is conducted by pooling annual data 1963 93 from up to 16 oecd countries the results provide strong evidence in support of the persistence hypothesis and the non linearity of the phillips curve while concurrently rejecting the other two alternative explanations

financial integration in the pacific basin region rip by panic attack abstract we exploit advances in panel data econometrics to test whether real interest parity holds in the pacific basin region we test for a unit root in the difference between either the us japanese or euro area real interest rate and the real interest rates from a panel of eleven pacific basin economies unlike extant studies that test for rip using panel data we use bai and ng s 2004 panic test which allows for a very general model of cross section dependence including the possibility of cross unit cointegration ignoring the possibility of cross unit cointegration can lead to severe size distortions and to an over rejection of the null hypothesis of a unit root we overturn earlier findings based on first generation panel tests and demonstrate that cross unit cointegration leads to incorrect conclusions we find that rip holds in the pacific region real interest rates converge to the us rate we find no support for the hypothesis that pacific basin real interest rates converge to either the japanese or euro area rates

armod a small numerical macroeconomic world model with non clearing markets the purpose of this paper is to demonstrate the usefulness of a non walrasian numerical modeling approach to current macroeconomic problems of excessive unemployment and trade imbalances in the oecd area the model which consists of five world regions generates a sequence of short run equilibria the model captures international transmission mechanisms of business cycle impulses and of the effects of monetary and fiscal policy assuming flexible interest and exchange rates full capital mobility and adaptive expectations a scenario with successful international policy coordin ation illustrates how the model works copyright 1987 by the editors of the scandinavian journal of economics

the international linkage of real interest rates the european us connection abstract in this paper we present evidence on several questions regarding the movement in short term real interest rates in eight countries have ex ante real estates in the united states and europe been high during recent years has there been a link between us real rates and those in other countries can this link be quantified the basic finding in this paper is that real rates have climbed dramatically from the 1970s to the 1980s in both the european countries and the united states there is also strong evidence that there is a positive association between movements in us real rates and those in europe however european real rates typically do not move one for one with us real rates still leaving open the possibility that european monetary policy can influence domestic economic activity

international expected real interest rates new tests of the parity hypothesis and u s fiscal policy effects abstract this paper investigates the links among expected real interest rates across countries and also those between international expected real interest rates and u s fiscal policy we analyze the cross sectional mean of international ex post real interest rates as an estimator for the mean international expected real interest rate our results strongly reject the international expected real interest rate parity hypothesis reveal that u s budget deficits have no independent effects on international real rates given the impact of u s government defense spending and suggest that forces other than u s fiscal policy account for the post 1980 rise in international real rates

sovereignty relinquished explaining commitment to the international human rights covenants 1966 1999 this article examines whether the content of the international human rights covenants and the costs associated with their ratification influence the decision of countries to join the author evaluates three theoretical perspectives rationalism world polity institutionalism and the clash of civilizations with data for more than 130 countries between 1966 and 1999 rationalists contend that treaty ratification is tightly coupled with internal sovereignty arrangements human rights practices and ideological commitments all of which become more important as treaty enforcement strengthens world polity institutionalists expect ratification to be loosely coupled with a country s conduct or its political ideological or cultural commitments although this gap narrows as compliance is more effectively enforced a civilizations approach predicts tight coupling between ratification and cultural values regardless of the mechanisms in place for enforcing compliance results lend partial support to rationalism a

a macroeconomic rationing model of the belgian economy despite a wide recognition of the possible theoretical fruitfulness of the quantity rationing approach there prevails an equally wide suspicion as to the possibility of getting sensible econometric results out of this type of specification our aim in the following will be to show that sensible results can indeed be obtained we shall consider for that purpose the belgian goods and labor markets over the years 1953 1978 and specify the econometric model along the lines suggested in the previous chapter

on the constancy of the international real rate of interest abstract this paper develops an alternative method of deriving the ex ante real rate of interest given assumptions regarding capital mobility and ppp it is shown that in equilibrium the ex ante real rate will be equalized across countries using cross sectional regression techniques this real rate can be estimated at each moment in time hence it is possible to develop a time series of estimated real rates derived from cross sectional regressions this estimated real rate series is then used in time series tests of the fisher equation for the u s

dynamic linkages among real interest rates in international capital markets abstract short run and long run dynamic linkages among weekly real interest rates for g 10 countries are examined using a variety of time series tests these tests give special attention to the time series properties of nominal interest rates ex ante expected rates of inflation and real interest rates term structure information is used to recover a theoretically consistent measure of ex ante expected inflation in sample and out of sample granger causality tests are also examined to evaluate lead lag relationships among real interest rates the results provide strong support for well integrated markets particularly in the long run the results imply leadership roles for the us in international asset markets