Several papers have documented a regime switch in US monetary policy from ‘passive’ and destabilizing in the pre-1979 period to ‘active’ and stabilizing afterwards. These studies typically work with DSGE models with rational expectations. This paper relaxes the assumption of rational expectations and allows for learning instead. Economic agents form expectations from simple models and update th...

In this paper, we investigate the determinants of political instability in Latin America. In a panel of 18 Latin American countries from 1971 to 2000, we find that democratic countries experience less average instability in the region, indicating that the move to increased democracy in the last couple decades may alleviate the persistent problem of instability in the area. We also find that inc...

The level, tenor and instability of capital flows from global financial markets towards developing countries are a major source of concern for macroeconomic managers, while their causes remain largely unexplained by economic theory. Country ‘fundamentals’ (such as economic growth, monetary stability and institutional capacity) as sources of default risk have been the main focus of economic rese...

This study attempts to establish the relationship between three types of instabilities and economic growth. Political instability, macroeconomic terrorism, growth are analyzed for period 1970 2019 in Pakistan. The constructs indices above-mentioned variables by adding some new variables. Results show that political GDP per capita have long-run associations. instability is positively related ter...

This data article provides macroeconomic data that can be used to generate macroeconomic volatility. The data cover a sample of seven selected countries in the Asia Pacific region for the period 2004-2014, including both developing and developed countries. This dataset was generated to enhance our understanding of the sources of macroeconomic volatility affecting the countries in this region. A...

Many modelling issues and policy debates in macroeconomics depend on whether macroeconomic time series are best characterized as linear or nonlinear. If departures from linearity exist, it is important to know whether these are endogenously generated (as in, e.g., a threshold autoregressive model) or whether they merely re°ect changing structure over time. In this paper, we discuss a model comp...

Although there is a substantial body of literature on macroeconomic policies in Latin America, the role of fiscal and monetary policies as tools to stabilize the business cycle has not received much attention. This is understandable in light of the fact that during the last thirty years, both fiscal and monetary policies were responsible, to a large degree, for the region’s history of macroecon...