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Government guarantees for private infrastructure projects reduce the incentives of firms to perform efficiently, weaken the incentives to screen projects for white elephants, and shift government obligations to future periods. Thus the use of guarantees needs to be limited, and they need to be ca...

Privatization of infrastructure ventures in sectors such as energy, telecommunications, transport and water has become popular over the last decade. Often �for good or bad reasons- private firms are given monopoly franchises under some type of long-term concession agreement, for example "Build-Op...

In this paper, we analyze the evolution of the counterinflation reputation implied by joining the exchange rate mechanism of the European Monetary System. We apply a Backus and Driffill (1985a, b) type model where maintaining the existing parity would improve the probability perceived by agents t...

This paper characterizes the equilibria of infrastructure franchising under incomplete contracting and ex�post renegotiation. The parties (government and a firm) are unable to credibly commit to the contracted investment plan, so that a second step investment (labeled as investments in service qu...

Market designs concerns creation of transaction rules, effectively an automated intermediary. I extend the work of Vives (1998), finding that, for moderately sized auction markets, coordination is more important than strategic behavior in determining efficiency. Second, with Cournot competition, ...

This paper studies the evolution and composition of the public debt of Mexico, with an emphasis on the internal components. The results of the analysis suggest that there is no evidence of a strong relationship between the premia payed by the different instruments and the structure of the public ...

International capital market integration together with increasing international volatility, requires an accurate evaluation of the potential losses that portfolio managers may face as a result of international turbulence. Assets with high liquidity standards can be evaluated by the traditional Va...

This paper studies empirical regularities of daily log returns for the years 1989 through 1996, using aggregate indexes and quintiles rated by size, for a specific emerging market: the case of Chile. Within the context of the existing literature on emerging markets, this study's contributions are...

Two difficulties arise when different jurisdictions have value added taxes at different rates. First, "magnification effect" which consists of an automatic enlargement of the rate differential over and above the one established by the respective legislations. Second, a fraud known as "invoice sig...

Most of the policy assertions in the paper by Srinivas and Yermo (1999), published in Revista de Análisis Económico, are not backed by the empirical evidence. Their conclusions that "pension funds (in Chile) did not choose an efficient asset allocation or risk return combination", and that "curre...