We analyze the relations between Granger (G) non-causality and a notion of structural causality arising naturally from a general nonseparable recursive dynamic structural system. Building on classical notions of G non-causality, we introduce interesting and natural extensions, namely weak G non-causality and retrospective weakG non-causality. We show that structural non-causality and certain (r...

Recent international macroeconomics literature on sudden stops faces a puzzling ambiguity. Using essentially the same basic small, open economy model with collateral constraints, some studies successfully predict the empirically observed link between sudden stops and output drops, while others get the opposite result where sudden stops lead to increases in output. In this paper we resolve this ...

Multicountry unions pose stability problems that can be tackled by dynamic game models of non– conventional form, with payoff functions replaced by subsets of the state–space. A country aspiring to join a multicountry union must guarantee that a set of economic indicators stay within the bounds dictated by the union. Mathematically, this translates into membership of the state vector to a conve...

We study the importance of the local elite as a determinant of the e¤ectiveness of foreign aid in developing countries. An "extractive" elite will misuse aid ‡ows, an issue that is probably as old as foreign aid itself. We proxy for the existence of an "extractive" elite by using an historically determined variable: the percentage of European settlers in colonial times. Our econometric results ...

Abstract This article contributes to the literature on complexity and macroeconomic models by exploring analytical relationship tensions between complex phenomena macroeconomics. By evaluating properties of organised complexity, this suggests alternative strategies for analysing macroeconomy. Drawing F. A. Hayek’s notion I examine how its causal relate criteria assumptions that contemporary use...

Experimental macroeconomics is a subfield of experimental economics that makes use of controlled laboratory methods to understand aggregate economic phenomena and to test the specific assumptions and predictions of macroeconomic models. Surveys of experimental macroeconomics are found in Ochs (1995), Duffy (1998) and Ricciuti (2004). Macroeconomic topics that have been studied in the laboratory...

This essay introduces a new featured section, to be published in Small Axe annually, that explores the critical vocabulary of field Caribbean studies.

Growth is an important topic in macroeconomics, which represents a large fraction of the literature and seeks to explain some facts in the long-term behavior of economies, complementing the also large literature about business cycle. These two topics are so relevant because macroeconomics is mostly worried about the first and second moments of macroeconomic activity (this is, development and cy...