Principles of Economics, Case and Fair,9e
... were backed by gold. The values were fixed in terms of a specific number of ounces of gold. At the end of World War II, the Bretton Woods system came into force before its demise in 1971. Under this system, countries were to maintain fixed exchange rates with each other. Governments must at times in ...
... were backed by gold. The values were fixed in terms of a specific number of ounces of gold. At the end of World War II, the Bretton Woods system came into force before its demise in 1971. Under this system, countries were to maintain fixed exchange rates with each other. Governments must at times in ...
A Macroeconomic Theory of the Open Economy
... u A policy that reduces national saving, such as a government budget deficit, reduces the supply of loanable funds and drives up the interest rate. u The higher interest rate reduces net foreign investment, reducing the supply of dollars. u The dollar appreciates, and net exports fall. ...
... u A policy that reduces national saving, such as a government budget deficit, reduces the supply of loanable funds and drives up the interest rate. u The higher interest rate reduces net foreign investment, reducing the supply of dollars. u The dollar appreciates, and net exports fall. ...
mmi05 razin 225761 en
... concept underpins a crucial vulnerability of the economy under peg regimes. The phrase refers to the inability of a country to borrow abroad in its own currency, because no foreign creditor is willing to gamble on the potential exchange rate instability. A plausible explanation for the widespread us ...
... concept underpins a crucial vulnerability of the economy under peg regimes. The phrase refers to the inability of a country to borrow abroad in its own currency, because no foreign creditor is willing to gamble on the potential exchange rate instability. A plausible explanation for the widespread us ...
Commentary: Global Liquidity: Public and Private
... policy rates lower than otherwise and/or intervene and accumulate foreign currency reserves. Importantly, this accumulation is not precautionary but the byproduct of those policies. I would suggest that this has been true both pre-crisis and, despite policy adjustments, post-crisis (Caruana 2012b, 2 ...
... policy rates lower than otherwise and/or intervene and accumulate foreign currency reserves. Importantly, this accumulation is not precautionary but the byproduct of those policies. I would suggest that this has been true both pre-crisis and, despite policy adjustments, post-crisis (Caruana 2012b, 2 ...
Define the term tax
... outcomes in the situation. The original problem, conflict, or situation is never directly addressed or resolved. However, avoiding behavior might be appropriate when the issue is perceived by the manager to be trivial. It might also be an appropriate approach to use when there is no chance of winnin ...
... outcomes in the situation. The original problem, conflict, or situation is never directly addressed or resolved. However, avoiding behavior might be appropriate when the issue is perceived by the manager to be trivial. It might also be an appropriate approach to use when there is no chance of winnin ...
Dollarization: A Primer - The Centre for Economic Performance
... Recent turmoil in financial markets has revealed the inherent vulnerability of intermediate exchange rate regimes and conventional pegs to sudden aggregate shocks in a context of rapidly growing global financial integration. As a result, an incresing number of economists and policymakers has endorse ...
... Recent turmoil in financial markets has revealed the inherent vulnerability of intermediate exchange rate regimes and conventional pegs to sudden aggregate shocks in a context of rapidly growing global financial integration. As a result, an incresing number of economists and policymakers has endorse ...
Richard and Olofin- Full Text - International Scientific Indexing
... for developing economies are still few and far between. In what follows we bridge this gap by using the approach to study the Nigerian macroeconomy within the small open economy (SOE) model. The rest of this paper is organized as follows. Section 2 summarizes our SOE model while section 3 discusses ...
... for developing economies are still few and far between. In what follows we bridge this gap by using the approach to study the Nigerian macroeconomy within the small open economy (SOE) model. The rest of this paper is organized as follows. Section 2 summarizes our SOE model while section 3 discusses ...
Sectoral Analysis
... the IS-LM model in the open macro-economics. The degree of mobility of international capital flows and the choice of foreign exchange policy modify the operation of IS-LM. No country other than the might U.S. can claim that the IS-LM model works as itself. All other countries should take into consid ...
... the IS-LM model in the open macro-economics. The degree of mobility of international capital flows and the choice of foreign exchange policy modify the operation of IS-LM. No country other than the might U.S. can claim that the IS-LM model works as itself. All other countries should take into consid ...
Arshad Zabir
... The present study is based on quarterly data covering the period from 1982Q2 through 2002Q4, which include the 1990s reforms period as well. M is the broad money, which includes all Pak-rupee denominated currency in circulation plus demand, time and foreign currency deposits. P is the price level pr ...
... The present study is based on quarterly data covering the period from 1982Q2 through 2002Q4, which include the 1990s reforms period as well. M is the broad money, which includes all Pak-rupee denominated currency in circulation plus demand, time and foreign currency deposits. P is the price level pr ...
If Exchange Rates Are Random Walks Then Almost Everything We
... changes in interest rates affect the economy by altering the conditional means of the macroeconomic aggregates and have no effect on the conditional variances of these aggregates. We argue that the data on exchange rates imply nearly the opposite: fluctuations in interest rates are associated with nea ...
... changes in interest rates affect the economy by altering the conditional means of the macroeconomic aggregates and have no effect on the conditional variances of these aggregates. We argue that the data on exchange rates imply nearly the opposite: fluctuations in interest rates are associated with nea ...
International Monetary Systems
... fixed price of gold at $35/ounce, and therefore would rush to redeem their dollar assets before the gold ran out. – This problem is similar to what any central bank may face when it tries to maintain a fixed exchange rate. – If markets perceive that the central bank does not have enough official int ...
... fixed price of gold at $35/ounce, and therefore would rush to redeem their dollar assets before the gold ran out. – This problem is similar to what any central bank may face when it tries to maintain a fixed exchange rate. – If markets perceive that the central bank does not have enough official int ...
DD-AA
... Aggregate Demand (cont.) • Determinants of aggregate demand include: ¨ Real exchange rate: an increase in the real exchange rate increases the current account, and therefore increases aggregate demand for domestic products. ¨ Disposable income: an increase in the disposable income increases consumpt ...
... Aggregate Demand (cont.) • Determinants of aggregate demand include: ¨ Real exchange rate: an increase in the real exchange rate increases the current account, and therefore increases aggregate demand for domestic products. ¨ Disposable income: an increase in the disposable income increases consumpt ...
Monetary Accounts: Analysis and Forecasting
... Forecasting Money Money is determined by equilibrium between money demand and money supply Money demand, like the demand for goods and services, depends on Income, i.e., GNP Price, i.e., the opportunity cost of holding money Inflation rate in developing countries Interest rate in industrial ...
... Forecasting Money Money is determined by equilibrium between money demand and money supply Money demand, like the demand for goods and services, depends on Income, i.e., GNP Price, i.e., the opportunity cost of holding money Inflation rate in developing countries Interest rate in industrial ...
Political Contagion in Currency Crises
... does not appear to be a general explanation. The magnitudes seem wrong because “contagious” attacks hit currencies where the bilateral trade volumes just are not large enough. However, this bilateral view is probably too limited, for we should consider multilateral linkages, whereby two countries co ...
... does not appear to be a general explanation. The magnitudes seem wrong because “contagious” attacks hit currencies where the bilateral trade volumes just are not large enough. However, this bilateral view is probably too limited, for we should consider multilateral linkages, whereby two countries co ...
2014-11 - University of Glasgow
... This paper demonstrates that all of the currency options available to an independent Scotland come with the price tag of an austerity programme. This is due to the need to accumulate foreign exchange ...
... This paper demonstrates that all of the currency options available to an independent Scotland come with the price tag of an austerity programme. This is due to the need to accumulate foreign exchange ...
STOCK PRICE AND EXCHANGE RATE: THE CASE OF BIST 100
... leaving the market altogether, they will exchange the local currency they obtained by selling the shares into an internationally valid currency. Financial transactions are expected to decrease in markets with high uncertainty and foreign exchange rates will depreciate significantly. This situation w ...
... leaving the market altogether, they will exchange the local currency they obtained by selling the shares into an internationally valid currency. Financial transactions are expected to decrease in markets with high uncertainty and foreign exchange rates will depreciate significantly. This situation w ...
Rethinking the Role of NCBs in the EMU
... in the amount -Xw. These two effects reinforce each other, and thereby create an excess supply in the domestic goods market. The second entry in the first line of the matrix relates excess demand in the domestic goods market to the level of domestic interest rates. The negative sign here indicates t ...
... in the amount -Xw. These two effects reinforce each other, and thereby create an excess supply in the domestic goods market. The second entry in the first line of the matrix relates excess demand in the domestic goods market to the level of domestic interest rates. The negative sign here indicates t ...
1 Economic way of thinking
... • Often criticized as having a libertarian bias • Also criticized by behavioral economists as unrealistic ExampleIf the economic way of thinking is so bad, why do we use it? • Answer: To build tractable mathematical models to undertake policy experiments ...
... • Often criticized as having a libertarian bias • Also criticized by behavioral economists as unrealistic ExampleIf the economic way of thinking is so bad, why do we use it? • Answer: To build tractable mathematical models to undertake policy experiments ...
The Relationship between Commodities and Pakistani Currency
... commodities (non-food agricultural and metals). The data comprised of a period of 5 years (1994-1999). While South Africa's exports have become increasingly diversified along time, the commodities contributed major portion to export earnings. During 2002 to 2004 the increase in South African commodi ...
... commodities (non-food agricultural and metals). The data comprised of a period of 5 years (1994-1999). While South Africa's exports have become increasingly diversified along time, the commodities contributed major portion to export earnings. During 2002 to 2004 the increase in South African commodi ...
Currency Crises
... monetary policy. In practice, this means that it must be willing to raise domestic interest rates high enough to maintain the attractiveness of its currency to speculators. But, as the examples above show, many countries with pegged exchange rate regimes at some time or another have found forgoing a ...
... monetary policy. In practice, this means that it must be willing to raise domestic interest rates high enough to maintain the attractiveness of its currency to speculators. But, as the examples above show, many countries with pegged exchange rate regimes at some time or another have found forgoing a ...
Net capital flows and real exchange rate depreciation effects on the business cycle in emerging market:
... measure the rate between the domestic currency and the foreign currencies in which EMs tend to have denominated their foreign liabilities. Thus, an advantage of using this index is precisely its focus on the real exchange rate between borrowers and lenders, which has been the centre of discussion in ...
... measure the rate between the domestic currency and the foreign currencies in which EMs tend to have denominated their foreign liabilities. Thus, an advantage of using this index is precisely its focus on the real exchange rate between borrowers and lenders, which has been the centre of discussion in ...
Foreign-exchange reserves
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Foreign-exchange reserves (also called forex reserves or FX reserves) are assets held by a central bank or other monetary authority, usually in various reserve currencies, mostly the United States dollar, and to a lesser extent the euro, the pound sterling, and the Japanese yen, and used to back its liabilities—e.g., the local currency issued, and the various bank reserves deposited with the central bank by the government or by financial institutions.