I study optimal capital flow management in a small open-economy DSGE model with two frictions: downward nominal wage rigidity and a pricedependent collateral constraint. Wage rigidity introduces an aggregate demand externality under fixed exchange rates and the collateral constraint introduces a pecuniary externality. I provide an analytical characterization of the optimal capital flow manageme...

This is a very nice and elegant paper by Ozge Senay and Alan Sutherland. The main objective of the paper is to examine the extent to which changes in the degree of price flexibility modify the ranking of alternative monetary policy regimes in an open economy framework. The model that the authors propose belongs to the New Open Economy Macro (NOEM) literature which builds models following the Ne...

This paper contains an investigation into the potential linkages between the short-run (cyclical) and long-run (secular) movements in economic activity. The investigation is based on an analytically solvable stochastic monetary growth model in which learning-by-doing accounts for endogenous technological change. The dynamic general equilibrium of this model implies that both the ...rst and seco...

In this paper, I study the properties of the Ramsey equilibrium in a model with distortionary taxation, nominal non-state-contingent debt, and costs of surprise inßation. To do this, I modify the standard cash-credit good economy studied in the optimal policy literature to include sticky prices. With this modiÞcation, the Ramsey planner must balance the shock absorbing beneÞts of surprise inßat...

The notion that business cycles are driven by demand shocks is subtle. I first review some of the conceptual and empirical challenges faced when trying to accommodate this notion in micro-founded, general-equilibrium models. I next review my own research, which sheds new light on the observed business cycles by accommodating frictional coordination in the form of higher-order uncertainty. This ...

There are many great ways to incorporate behavioral economics in a first-year undergraduate economics class—i.e., the course that is typically called “Principles of Economics.” Our preferred approach integrates behavioral economics throughout the course (e.g., see Acemoglu, Laibson, and List 2015). With the integrated approach, behavioral content plays a role in many of the chapters of the prin...

The relation between the properties of polyampholytes in aqueous solution and their adsorption behaviors on silica and cellulose surfaces was investigated. Four polyampholytes carrying different charge densities but with the same nominal ratio of positive to negative segments and two structurally similar polyelectrolytes (a polyacid and a polybase) were investigated by using quartz crystal micr...

The price system, the adjustment of prices to changes in market conditions, is the primary mechanism by which markets function and by which the three most basic questions get answered: what to produce, how much to produce and for whom to produce. To the behaviour of price and price system, therefore, have fundamental implications for many key issues in microeconomics and industrial organization...