Reallocation of Resources within the National Productive System in Bolivia: A View from the Perspective of Tradable and Non-Tradable Goods

This paper explores Bolivia’s current unemployment situation taking into account the reallocation of resources within the aggregate supply. The origin of this internal imbalance is due to negative impacts of external real exchange rate (RER) shocks, as well as to changes in the destination of foreign direct investment (FDI) among different sectors of the economy. The model used to explain the imbalance is based on the Dependent Economy theoretical framework, in which production in a small open economy is disaggregated into tradable and non-tradable goods. Under this production scheme, any RER movement in terms of appreciation or depreciation produces a displacement of resources, either along the production possibilities frontier or through the unemployment zone. After demonstrating that the RER suffered an important appreciation in 1997, a model of the aggregate-supply function is constructed considering two variable outputs (tradable and non-tradable goods) and two variable inputs (capital and labor), suggesting in the end the existence of a slow restructuring process at the expense of unemployment of the labor force.Inter-sector labor mobility, Internal balance, Tradable-Nontradable (TNT) model

Long Run Neutrality of Money in Mexico

The Fisher-Seater (FS) methodology is used to investigate long run money neutrality with respect to real GDP and real output in ten selected industries in Mexico. Size distortions and low power of the FS test, issues first raised by Coe and Nason (2003, 2004), are addressed using the Coe-Nason bootstrapping procedure. The evidence indicates that long run money neutrality can be rejected for real GDP and for up to five of the ten industrial sectors studied. These findings indicate that the effects of monetary policy are likely to differ across sectors even in the long run.money neutrality, Fisher-Seater Test, bootstrapping.

Environmental Policies and Mergers’ Externalities

A Cournot oligopolistic setting model of trade is characterized by local and foreign firms competing in the presence of pollution quota and tax. Local firms are foreign-owned (FDI) and repatriate their profits. First, we analyze the impact on welfare given by the merger of the local firms, as a response to external firms’ competition and pollution abatement costs. Second, when merger is welfare decreasing, we study the best response of the government in order to compensate this negative externality. Finally, we compare the pollution quota and tax in order to determine their efficiency as a policy instrument.environmental policies, mergers, emission permits

Discurso preparado por el Santo Padre Benedicto XVI para el encuentro con la Universidad de Roma “La Sapienza”

Texto de la conferencia que el Papa Benedicto XVI iba a pronunciar durante su visita a la “Sapienza, Universidad de Roma”, el jueves 17 de enero. Visita cancelada el 15 de enero.Text of the conference that Pope Benedict XVI was to deliver during his visit to the "Sapienza, University of Rome" on Thursday January 17. Visit canceled on January 15