International Aspects of U.S. Monetary and Fiscal Policy Paul Krugman* Introduction
... the relevant interest differential between this country and other industrial countries. This is hardly a conclusive discussion. The point is that it remains a viable working hypothesis that the strength of the dollar has basically reflected the divergence in macroeconomic policies between the United ...
... the relevant interest differential between this country and other industrial countries. This is hardly a conclusive discussion. The point is that it remains a viable working hypothesis that the strength of the dollar has basically reflected the divergence in macroeconomic policies between the United ...
Chapter 19
... (EFSF) and it and the IMF began to commit funds in order to help soothe the markets Eventually, the EFSF morphed into the European Stability Mechanism (ESM), a permanent bail-out fund © Kenneth A. Reinert, Cambridge University Press 2012 ...
... (EFSF) and it and the IMF began to commit funds in order to help soothe the markets Eventually, the EFSF morphed into the European Stability Mechanism (ESM), a permanent bail-out fund © Kenneth A. Reinert, Cambridge University Press 2012 ...
This PDF is a selection from a published volume from... Bureau of Economic Research Volume Title: NBER International Seminar on Macroeconomics
... rate movements, the relative price of home to foreign (or, in EMU’s case, extraregional) goods. But, quite obviously, while the nominal exchange rate with a Europeanized monetary policy is gone, by definition this real adjustment option evidently still exists. It is at the same time true that adjust ...
... rate movements, the relative price of home to foreign (or, in EMU’s case, extraregional) goods. But, quite obviously, while the nominal exchange rate with a Europeanized monetary policy is gone, by definition this real adjustment option evidently still exists. It is at the same time true that adjust ...
Testing the Taylor Model Predictability for Exchange Rates
... Motivated by those new developments and trying to build up on the recent results, we incorporate Latin America economies in the exchange rate predictability analysis. Our focus is to test for cointegration relationships and apply a mean correction error formulation to the Taylor rule model and a bro ...
... Motivated by those new developments and trying to build up on the recent results, we incorporate Latin America economies in the exchange rate predictability analysis. Our focus is to test for cointegration relationships and apply a mean correction error formulation to the Taylor rule model and a bro ...
NBER WORKING PAPER SERIES EXTERNAL CONSTRAINTS ON MONETARY POLICY Mark Gertler
... Put differently, countries in the position of having to defend an exchange rate peg were more likely to have suffered severe financial distress. The likely reason is straightforward: defending an exchange rate peg generally requires the central bank to adjust interest rates in a direction that reinfor ...
... Put differently, countries in the position of having to defend an exchange rate peg were more likely to have suffered severe financial distress. The likely reason is straightforward: defending an exchange rate peg generally requires the central bank to adjust interest rates in a direction that reinfor ...
A Small Open Economy in the Great Depression: the Case of
... forecast error variance. The results show that the economic part of the model contributes a significant variance share. The structural approach enables us to embark on a counterfactual experiment by simulating the Swiss economy in the case of a devaluation of the Swiss franc in September 1931, the m ...
... forecast error variance. The results show that the economic part of the model contributes a significant variance share. The structural approach enables us to embark on a counterfactual experiment by simulating the Swiss economy in the case of a devaluation of the Swiss franc in September 1931, the m ...
Exchange Control Liberalization, Measures and Their Economic
... In economics, the transactions involving foreign exchange are defined and recorded in the balance of payments of a country (BOP). The BOP is the economic presentation of financial flows (inflows and outflows or receipts and payments) underlying the economic transactions of a country with the rest of ...
... In economics, the transactions involving foreign exchange are defined and recorded in the balance of payments of a country (BOP). The BOP is the economic presentation of financial flows (inflows and outflows or receipts and payments) underlying the economic transactions of a country with the rest of ...
Effects of the U.S. Quantitative Easing over a Small Open Economy
... mitigate any potential systemic risk in their economies. Unconventional monetary policies have been used by central banks in developed economies to stimulate their economies because standard monetary policies have become ineffective (when the short-term interest rate is at its zero lower-bound). Wa ...
... mitigate any potential systemic risk in their economies. Unconventional monetary policies have been used by central banks in developed economies to stimulate their economies because standard monetary policies have become ineffective (when the short-term interest rate is at its zero lower-bound). Wa ...
Report to the Executive Board of the Norges Bank On the Decision
... Our reading of Inflation Reports and Strategy Documents is that the Norges Bank's view is that there are a number of important channels through which monetary policy changes currently affect inflation. First, interest rate changes and their induced effects on exchange rates both affect output, which ...
... Our reading of Inflation Reports and Strategy Documents is that the Norges Bank's view is that there are a number of important channels through which monetary policy changes currently affect inflation. First, interest rate changes and their induced effects on exchange rates both affect output, which ...
International Trade
... Explain why comparative advantage is likely to change over time Comparative advantage is a dynamic concept and must be expected to change. For example comparative advantage in the production of lower valued added textiles has shifted away from Western European producers to Asian economies where unit ...
... Explain why comparative advantage is likely to change over time Comparative advantage is a dynamic concept and must be expected to change. For example comparative advantage in the production of lower valued added textiles has shifted away from Western European producers to Asian economies where unit ...
Madagascar: A Competitiveness and Exchange Rate Assessment
... international markets, the REER constitutes an improvement over the nominal exchange rate because changes in competitiveness depend not only on exchange rate variations but also on cost and price trends. As a first approximation, an appreciation of the REER may be interpreted as a deterioration of c ...
... international markets, the REER constitutes an improvement over the nominal exchange rate because changes in competitiveness depend not only on exchange rate variations but also on cost and price trends. As a first approximation, an appreciation of the REER may be interpreted as a deterioration of c ...
Dr Sri Mulyani Indrawati
... balance, while the fiscal policies will be aimed to stabilize the internal balance of the macroeconomic system. Indonesia decided early on a course of counter-cyclical economic policies. We based our action on the premise that the immediate task is to restore confidence and the aggregate demand. Thi ...
... balance, while the fiscal policies will be aimed to stabilize the internal balance of the macroeconomic system. Indonesia decided early on a course of counter-cyclical economic policies. We based our action on the premise that the immediate task is to restore confidence and the aggregate demand. Thi ...
Explaining the Differences between Local Currency versus FX
... the one hand, they could rely on cheap FX funding from their parents abroad, whereas attracting deposits as a source of lending promised to be a longer and more involved process. On the other hand, extending FX loans shielded foreign banks from the exchange rate risk of dealing with often volatile d ...
... the one hand, they could rely on cheap FX funding from their parents abroad, whereas attracting deposits as a source of lending promised to be a longer and more involved process. On the other hand, extending FX loans shielded foreign banks from the exchange rate risk of dealing with often volatile d ...
EMU strategies: Lessons from Greece in view of the EU Enlargement
... fundamental component of a more comprehensive strategy aimed at lasting growth with stability, a progressive return to full employment, the harmonisation of living standards and the lessening of regional disparities in the Community…’. The EMS was based on the concept of fixed, but adjustable exchan ...
... fundamental component of a more comprehensive strategy aimed at lasting growth with stability, a progressive return to full employment, the harmonisation of living standards and the lessening of regional disparities in the Community…’. The EMS was based on the concept of fixed, but adjustable exchan ...
Global interactions: oil shocks and currency crises
... ‘boom’ (discovery of new resources): Raises output of resource sector and reduces output of both other sectors through competition for labor, which raises wages … … and leads to excess demand for services, which produces a real appreciation … … which diminishes output gain in resources sector and ...
... ‘boom’ (discovery of new resources): Raises output of resource sector and reduces output of both other sectors through competition for labor, which raises wages … … and leads to excess demand for services, which produces a real appreciation … … which diminishes output gain in resources sector and ...
Country Profile: Turkey Macroeconomic Policy and
... slow to adjust. The real rate of interest remained above 10% over 2004 and generated heavy pressures against the fiscal authority in meeting its debt obligations. The persistence of the real interest rates, on the other hand, had also been responsible in attracting heavy flows of short term speculat ...
... slow to adjust. The real rate of interest remained above 10% over 2004 and generated heavy pressures against the fiscal authority in meeting its debt obligations. The persistence of the real interest rates, on the other hand, had also been responsible in attracting heavy flows of short term speculat ...
Economics and Political Economy
... Earlier contributions to the theoretical literature on currency crises pointed almost exclusively to deteriorating economic fundamentals as the trigger for currency crises. However, few studies have made an attempt to investigate empirically whether a particular exchange rate regime is more prone to ...
... Earlier contributions to the theoretical literature on currency crises pointed almost exclusively to deteriorating economic fundamentals as the trigger for currency crises. However, few studies have made an attempt to investigate empirically whether a particular exchange rate regime is more prone to ...
schnabl mmi08 6642029 en
... weak during the 1970s, but may have become stronger during the 1980s and 1990s. Interest rates may decline when the yen appreciates (falling exchange rate in price notation) but may remain unchanged when the yen depreciates. This is suggested by the upper panel of Figure 1 which shows the developmen ...
... weak during the 1970s, but may have become stronger during the 1980s and 1990s. Interest rates may decline when the yen appreciates (falling exchange rate in price notation) but may remain unchanged when the yen depreciates. This is suggested by the upper panel of Figure 1 which shows the developmen ...
The Effective Demand Approach to Economic Development Jan
... movement in the prices of primary commodities and manufactured goods to the detriment of the former. Thus, if developing countries are to generate the finance required to build up a manufacturing sector by purchasing manufactured-goods exports from developed countries they would have to increase pri ...
... movement in the prices of primary commodities and manufactured goods to the detriment of the former. Thus, if developing countries are to generate the finance required to build up a manufacturing sector by purchasing manufactured-goods exports from developed countries they would have to increase pri ...
Net Capital Outflow
... • A trade restriction increases net exports and increases the demand for dollars in the market for foreign-currency exchange. • As a result, the dollar appreciates in value, making domestic goods more expensive relative to foreign goods. • This appreciation offsets the initial impact of the trade re ...
... • A trade restriction increases net exports and increases the demand for dollars in the market for foreign-currency exchange. • As a result, the dollar appreciates in value, making domestic goods more expensive relative to foreign goods. • This appreciation offsets the initial impact of the trade re ...
32 - Mersin
... • A trade restriction increases net exports and increases the demand for dollars in the market for foreign-currency exchange. • As a result, the dollar appreciates in value, making domestic goods more expensive relative to foreign goods. • This appreciation offsets the initial impact of the trade re ...
... • A trade restriction increases net exports and increases the demand for dollars in the market for foreign-currency exchange. • As a result, the dollar appreciates in value, making domestic goods more expensive relative to foreign goods. • This appreciation offsets the initial impact of the trade re ...
THE ROLE OF INTEREST RATES IN BUSINESS CYCLE
... responses to cyclical disturbances, its lack of solid theoretical foundations makes it susceptible to the “Lucas critique”. In particular, policy analysis using reduced-form equations that fit the data but are only loosely tied to theory cannot, among other things, properly account for resulting shi ...
... responses to cyclical disturbances, its lack of solid theoretical foundations makes it susceptible to the “Lucas critique”. In particular, policy analysis using reduced-form equations that fit the data but are only loosely tied to theory cannot, among other things, properly account for resulting shi ...