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Essays on international economics and industrial organization

University of British Columbia

This dissertation addresses two issues in international economics and one issue in industrial organization. The first two chapters use sticky-price intertemporal optimizing models with incomplete financial markets to analyze the dynamics of the current account after technology shocks and the effects of the optimal monetary policy on current account movements. The third chapter models the upgrade behavior of existing software users and new software users under two market structures. The first chapter studies a small open economy with two sectors. In a perfect foresight, rational expectation general equilibrium model, with sticky prices in the non-traded goods sector, the evolution of the current account following a positive technology shock is efficient even without time consistent optimal monetary policy. The second chapter extends the general equilibrium model to a two-country economy and analyzes the effects of the optimal monetary policy on current account dynamics. The welfare gain for home households from the individual optimal expansionary monetary policy mainly comes from the home country's terms of trade improvement when most firms price the export prices in buyer currency. The third chapter finds that, for the new software version, the software vendor should offer a price discount to existing users and charge a higher price to new users if software users are sufficiently heterogeneous. For the old software version, a price discount should be applied to existing users with a higher price to new users if the price of the co-existing new version is high.

Text

2011-02-16

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http://hdl.handle.net/2429/31391

Economics

University of British Columbia

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