Economic dynamics and government stability in postwar Italy

Article Abstract:

The role of political and economic factors in the stability of a government was investigated. A duration model was presented to determine the probability of downfall of an Italian government. Empirical evidence indicates that political and economic factors can result in the collapse of a government, with inflation rate and labor strikes wielding the greatest influence. Specifically, there is a greater likelihood for a government to collapse when the inflation rate and the number of labor hours lost in strikes are higher.

Politics NEC, Italy, Models, Economic aspects, Political aspects, Inflation (Finance), Politics, Strikes, Inflation (Economics)

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Individual income, incomplete information, and aggregate consumption

Article Abstract:

Aggregate information is not valid for making decisions on individual consumption since individual income tends to be more variable than aggregate per capita income. Models of consumption are examined where individuals optimize on their own income activities, although they have insufficient economic information. Consumers react minimally to changes in aggregate income, thus aggregate consumption is very smooth. Empirical presentations on individual and aggregate income processes are shown.

Income

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Testing for liquidity constraints in Euler equations with complementary data sources

Article Abstract:

Tests were conducted to analyze liquidity constraints in Euler equations using credit status' direct indicators. The tests, which utilize the 1983 Survey of Consumer Finances, include an initial stage in which probabilities being constrained are estimated to come up with switching regression models estimates. Estimates of tests suggest robust excess sensitivity that is possibly linked with liquidity constraints.

Research, Liquidity (Finance), Euler's numbers, e (Number)

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