Essays on Open Economy

This dissertation has three chapters. The first one examines the causes of falling labour share in OECD and non-OECD countries since the 1980s. It finds that export and volatility are key drivers in OECD, but in the non-OECD, major forces are financial openness and investment’s relative price. The second chapter develops a model of currency substitution to explain the rising dollarisation in Cambodia. The last one develops and estimates a small open economy real-business cycle model to study the dynamics of Cambodian current account by including net unilateral transfers and net foreign direct investment as additional sources of macroeconomic fluctuations.