July 2-5, 1995

The conference was organized jointly by the Society for Economic Dynamics and Control (SEDC) and CREI. The purpose of this annual meeting which takes place every year in a different part of the world and which enjoys a very high reputation, is to assemble specialists in Economic Dynamics, a central field of Economics in order to exchange ideas, to comment on present research and to propose new lines of investigation.


Economic Policy and Distribution

Supply Side Interventions and Redistribution. T. Garcia-Mila, A. Marcet, E. Ventura
Altruism and Markets. E. Ligon
Unemployment Spells and the Income Distribution Dynamics. A. Castaneda, J. Diaz Gimenez, J. V. Rios-Rull
Deregulation with Consensus. S. Brusco, H. Hopenhayn
Moral Hazard and Adverse Selection in a Principal-Agent Insurance Model. A. Chassagnon
When Are Non-Anonymous Players Negligible?. D. Fudenberg, D. Levine, W. Pesendorfer
Inefficiency of Competitive Equilibrium with Asymmetric Information and Financial Intermediaries. A. Bisin, D. Guaitoli
Money and Credits
Welfare of Alternative Equilibrium Paths in the Kiyotaki-Wright Model. J. M. Renero
On Money as a Medium of Exchange When Goods Vary by Supply and Demand. X. Cuadras-Morat�, R. Wright
Credit Markets with Differences in Abilities: Education, Distribution, and Growth. J. De Gregorio, S. Kim
Industry Dynamics
An Application of a General Equilibrium Model with Entry and Exit to the Spanish Economy. C. Diaz Moreno, J. E. Galdon Sanchez
Thick-Markets Extenalities in US Manufacturing: a Dynamic Study with Panel Data. M. Jimenez, D. Jr. Marchetti
Competitive Pricing and Efficiency in Search Equilibrium. D. Mortensen, R. Wright
Cost Reducing Investment Competition and Industry Dynamics. E. Petrakis, S. Roy
Learning and Market Structure
Social Learning in a Changing World. G. Moscarini, M. Ottaviani
Evolving Market Structure: a Model of Price Dispersion and Loyalty. A. Kirman, J. Vriend.
On Learning and the Stability of Cycles. J. Bullard, J. Duffy
Altruism and Social Security
A Positive Theory of Social Security Based on Reputation. T. Cooley, J. Soares
New Evidence on Altruism: a Study of Tiaa-Cref Retirees. J. Laitner
Asset Pricing
Asset Pricing Implications of Real Market Frictions. J-P Danthine, J. B. Donaldson
Peso Problems: Their Theoretical and Empirical Implementacions. M. Evans
Growth and Technological Diffusion
International Patenting and Technology Diffusion. Jonathan Eaton, S. Kortum
Human Capital Accumulation, Endogenous Comparative Advantage, and Technological Change. A. Ciccone
Banks and Liquidity
A Model of Banking with Fiat Currency and Aggregate Risk. M. Loewy
Bank Runs and Deposit Insurance: Market Fragility and the Futures Market Performance Guarantee. R. Craine
Nonlinearities: Trade and Growth
Hysteresis in Export Volumes and Prices: an Econometric Analysis. G. Giovannetti, H. Samiei
Economic Reform as a Signal of Creditworthiness in Underdeveloped Counties. S. Parente
Human Capital, Heterogenous Agents and Technological Change. J. Bailon, L. Rivera-Batiz
Historical Economies
The Debasement Puzzle: an Essay on Medieval Monetary Policy. A. Rolnick, F. Velde, W. Weber
Dete Fabula Narrator? Growth, Structural Charge and Convergence in Europe 19th-20th Centuries. T. Daban, L. Prados
Spurious Volatility for Historical Output Series: the Case of Germany, 1913-1938. A. Ritschl
Membership Rules, Matching and Unemployment, J. Ortega
Matching Hetereogeneity and the Evolution of Income Distribution. D. Acemoglu
Marriage Matching and Dynamics. K. Burdett, M. Coles

Invited Lecture

Some Aspects of the Transition to an Economic Union. A. Marcet


Imperfect Competition and Cycles
Dynamics Complementarities: a Quantitative Analysis. R. Cooper, A. Johri
The Origin of Asymmetry in Factor Input Dynamics. F. Palm, G. Pfann
Bayesian Learning, Monopolistic Competition and the Real Business Cycle. B. Moore, D. Simard
Effort and Cycle: What Is the Story?. H. Uhlig, Y. Xu
Learning and Stability for Equilibrium
Optimal Experimentation in a Changing Environment. G. Keller, S. Rady
Non-Parametric Versus Linear Learning Devices: a Procedural Perspective. E. Barucci, L. Landi
Stability for Competitive Equilibrium with Respect to Recursive and Learning Processes. Y. Balasko, D. Royer
Equilibrium and Self Fulfilling Beliefs
Intertemporal Cournot and Walras Equilibrium: an Illustration. T. Cordella, M.Datta
Equilibrium Selections. B. Allen, J. Dutta, Hl Polemarchakis
On the Robustness of Sunspot Phenomena in Dynamical Systems. J. Davila
Arbitrage, Bubbles and Valuation. J. Werner.
Economic Growth
Technological Diffusion, Convergence and Growth. R. Barro, X. Sala-i-Martin
Colonialism in the Theory of Growth. G. Bertocchi
On Growth and Indeterminacy: Some Theory and Evidence. J. Benhabib, J. Gali
Was Prometheus Unbound by Chance? Risk, Diversification and Growth. D. Acemoglu, F. Zilibotti
Political Economy
Are Consumption Taxes Really Better Than Income Taxes. P. Krusell, V. Quadrini, J. V. Rios-Rull
On the Viability for Public Provision of Public Goods. G. Glomm
Political Economy and Public Education Finance. R. Fernandez, R. Rogerson
Job Creation, Job Destruction and Unemployment
Is Job Turnover Countercyclical. T. Boeri
Technological Progress, Job Creation and Job Destruction. D. Mortensen, C. Pissarides
Learning Dynamics
Economic Dynamics with Learning: New Stability Results. G. Evans, S. Honkaphja
Choice Without Belief. D. Easley, A. Rustichini
Political Economy
Rational Debate Leads to Unidimensional Conflict. T. Piketty, D. Spector
A Contribution to the Theory of Pork Barrel Spending .H. Cole, V. Chari
Growth Models
Accuracy Estimates For Numerical Solutions of Economic Growth Models. M. Santos, J. Vigo.
Multisectoral Growth with Marshallian Externalities. K. Neusser
Missed Oportunities Or Factor Reallocation Costs and Growth. J. P. Nicolini
Empirical Models of the Labor Market
Explaining the Time Path of Unemployment: the Differential Role of Growth, Business Cycles, Search Intensity and Labor Supply Factors. E. Yashiv
Capital-Skill Complementarity and Inequality. P. Krusell, L. Ohanian, J. V. Rios- Rull, G. Violante
Estimating a Dynamic Model of Labor Supply and Fertility in Intact Families: the Role of Part-Time Work. M. Francesconi
Convergence and Growth
The Poor Stay Poor: Convergence Across Countries and Regions with a Bayesian Data Approach. F. Canova, A. Marcet
Modeling the Impact of Technological Change Across Sectors and Over Time in Manufacturing. M. Forni, L. Reichlin
On Convergence in Endogenous Growth Models. S. Ortigueira, M. Santos.
Central Banks
Portuguese Banking Sector: a Mixed Oligopoly? F. Barros, L. Modesto
Is There a Tragedy of a Common Central Bank? -A Dynamic Analysis. B. Van Aarle, A. Lans Bovenberg, M. Raith
Do Exchange Rates Move to Address Regional Imbalances?. M. Canzoneri, J. Vallas
Fluctuations in Open Economies
The Sources of Business Fluctuactions in Small-Open Economies. A. Hoffmaister, J. Roldos
Is There Consumption Risk Sharing in the European Union? A. Ubide
Exchange-Rate Based Stabilizations: Theory and Evidence. S. Rebelo, C. Vegh
Invited Lecture
Theory and Measurement in Village Economies. R. Townsend


Dynamic Trade Models
The Poverty for Nations a Quantitative Exploration. V. Chari, P. Kehoe, E. McGrattan
General International Financial Equilibrium Modeling and Computation with Variational Inequialities. A. Nagurney, S. Siokos
Mark-Up Fluctuations in Us Manufacturing and Trade: Empirical Model Based on a Model of Optimal Storage. R. Kollman
A Forward Premium Anomaly: Three examples in Search of a Solution. D. Backus, S. Foresi, C. Telmer
Social Security
Is Social Security Really Bad For Growth? G. Bellettini, C. Berti Ceroni
Sustaining Fiscal Policy Through Immigration. K. Storesletten
Equilibrium with Social Security. M. Boldrin, A. Rustichini
Are Taxes Too Low?. P. Manasse
Asset Price Dynamics
Asset Price Dynamics and Infrequent Trades. P. Balduzzi, G. Bertola, S. Foresi
The Predictability for Security Returns with Simple Technical Trading Rules. R.Gencay
Stock Returns and Real Activity: a Structural Approach. F. Canova, G. De Nicolo
On the Impact of Leverage Constraints on Asset Prices and Trading Volume. J. M. Maron, J. Olivier
Growth and Income Distribution
Dynamics of the Income Distribution Across OECD Countries. J. Andres, A. Lamo
Sustained Growth, Government Expenditures and Inflation. P. Ferreira
Catch Up, Growth and Convergence in the OECD. A. De La Fuente
Home Production with Endogenous Growth. T. Einarsson, M. Marquis
Endogenous Fluctuations and Growth
Trade Dynamics and Endogenous Growth. an Overlapping Generations Analysis. A. Mountford
Monetary Emission, Financial Market Regulations and Real Exchange Rates in a Two-Country Growth Model. C. M. Betts
Increasing Returns to Scale and Endogenous Fluctuations in Overlapping Generations Models with Cournot Competition. T. Lloyd Braga
Endogenous Fluctuations in Multi-Sector ProductiveEconomies: Factor Intensity and Substitution. L. De Mello
Meeting and Contracting
Implementing the Efficient Allocation in a Model of Financial Intermediation. E. Green
Dynamic Bargaining Theory and Applications. M. Coles, R. Wright
Capital Mobility
Capital Mobility, Fiscal Policy and Growth with Self-Financing of Human Capital Formation. W. Buiter, K. Kletzer
Capital Flows and the Northamerican Free Trade Agreement. T. Kehoe
Investment and Firm Dynamics
Machine Replacement and the Business Cycle: Lumps and Bumps. R. Cooper, J. Haltiwanger, L. Power
(S, S) Inventory Policies in General Equilibrium. J. Fisher, A. Hornstein
Debt and Capital Flows
Recession Dynamics Following an External Price Shock in a Transition Economy. S.Gomulka, J. S. Lane
The Optimal Quantity for Debt. E. McGrattan, S. Rao Aiyagari
Estimated Models
Time Varying Risk Premia in General Equilibria. A. Novales
Can a Real Business Cycle Model Pass the Watson Test?. Y. Wen
An Econometric Analysis of Us Inflation Dynamics with Learning About Rational Expectations. P. Zadrozny
Calibrated Models of Animal Spirits
Comparing Four Models of Aggregate Fluctuations Due to Self-Fulfilling Expectations. S. Schmidt-Grohe
Can Animal Spirits Explain the European Unemployment Dynamics?. P. Feve, F. Langot
Indeterminacy, Home Production, and the Business Cycle: a Calibrated Analysis. R. Perli
European Integration
Macroeconomic policy Games and Asset-Price Volatility in the EMS: A Linear Quadratic Control Analysis of France, Germany, Italy and Spain. P. McNelis, C. Asilis
Currencies and the Allocation of Risk: the Welfare Effects of a Monetary Union. P, Andres Neumeyer
Dynamic Strategic Interaction
Dynamic Extenalities and Policy Coordination. M. Datta, L. Mirman
Alternative Time Patterns of Decisions and Dynamic Strategic Interactions. P. Cahuc, H. Kempf
Invited Lecture
Market Structure and the Growth Process. P. Aghion (with P. Howitt)
International Dynamicss
Transitional Dynamics, Convergence and International Capital Flows in Two-Country Models of Innovation and Growth. P. Tang, K. Waelde
Risk-Related Asymmetries in Foreign Exchange Markets. G. Gallo, B. Pacini
A Provincial Wiew of Capital Mobility. T. Bayoumi, M. Klein
Real Exchange Rate Targeting and Macroeconomic Instability. M. Uribe
Policy Coordination in Open Economies
Growth Gains From Trade and Education. S. Kim, Y. Jin Kim
Optimal Exchange Rate Targets and Macroeconomic Stabilization. E. Alberola Ila
A Time-Consistent Solution to the Stochastic Dynamic Strategic Export Subsidy Problem with Two Governments .K. Gatsios, T. Kollintzas, C. Lagopoulus
Monetary Innovations, Real Effects, and the European Monetary System. S. Baier
Asset Pricing and Heterogeneity
Double Lattices For Financial Analysis. D. Luenberger
Asset Prices and Undiversifiable Income Risk in an Overlaping Generations Model. P. Labadie.
The Order of Integration of Dividends and Excess Volatility for Stock Prices. M. Hagiwara, M. Herce
The Simple Analytics of Assets’ Values and Infrequent Policy Changes. P. Balduzzi, G. Corsetti, S. Foresi
CAPM-Based Minimax Hedging Strategy. M.A. Howe, B. Rustem, M. Selby
Growth Trade and Uncertainty
Marital Risk and Capital Accumulation. L. Cubeddu, J. V. Rios-Rull
Investment in New Activities and the Welfare Cost of Uncertainty. J. Aizenman
The Choice Between Leisure and Work and Modeling Endogenous Growth. A. Pelloni, R. Waldmann
Growth and Interdependence. J. Ventura
Issues in Monetary Economics
Money as an Intermediate Good and the Welfare Cost of the Inflation Tax. I. Correia, P. Teles
Liquidity Preference and Financial Intermediation. J. Dutta, S. Kapur
Unanticipated Monetary Schocks and the Business Cycle. T. Cooley, G. Hansen
The Effects of Monetary Policy in a Model with Reserve Requirements. J. Haslag

PANEL SESSION. (Organized by CREI)

A Look At the Spanish Economy
“Actual” Versus “Virtual” Employment in Europe: Why Is There Less Employment in Spain? R. Marimon, F. Zilibotti.
Employment Fluctuations and Persistence in Spain. J. Gali
Employment Creation and Destruction in the Spanish Economy. W. Garcia-Fontes, H. Hopenhayn
Regional Integration and Public Investment in Spain. T. Garcia-Milia, R. Marimon
A Monetary Union For a Heterogeneous Europe. G. Giovannetti, R. Marimon
Panel Discusants
M. Boldrin, Universidad Carlos III de Madrid
A. De La Fuente, IAE
J. F. Jimeno FEDEA
M. Nadal, Ministerio de Economia y Hacienda
A. Novales, Universidad Complutense de Madrid