Is Openness Inflationary? Imperfect Competition and Monetary
... First, increased openness reduces the burden of the inflation tax borne by the citizens of the inflating country in that they spend a larger portion of their currency holdings on Foreign goods. Second, inflation causes the terms of trade to appreciate in favor of the Home country. That is, the price ...
... First, increased openness reduces the burden of the inflation tax borne by the citizens of the inflating country in that they spend a larger portion of their currency holdings on Foreign goods. Second, inflation causes the terms of trade to appreciate in favor of the Home country. That is, the price ...
Madagascar: A Competitiveness and Exchange Rate Assessment
... on average by 9 percent a year between 1998 and 2007, up from 5 percent during the previous decade, and Madagascar has markedly reduced its dependence on traditional exports. At the same time, Madagascar has also experienced several negative shocks likely to undermine its competitiveness: the politi ...
... on average by 9 percent a year between 1998 and 2007, up from 5 percent during the previous decade, and Madagascar has markedly reduced its dependence on traditional exports. At the same time, Madagascar has also experienced several negative shocks likely to undermine its competitiveness: the politi ...
The Emerging Global Financial Architecture: Tracing and
... Against the backdrop of the most severe financial crisis since the Great Depression, the issue of whether the trilemma – the hypothesis that a country can only achieve two, but not all three, goals of monetary independence, exchange rate stability and financial integration – seems rather distant. We ...
... Against the backdrop of the most severe financial crisis since the Great Depression, the issue of whether the trilemma – the hypothesis that a country can only achieve two, but not all three, goals of monetary independence, exchange rate stability and financial integration – seems rather distant. We ...
(ΔY) +
... Under fixed exchange rate system, devaluation is allowed only within narrow limits and adjustment must come from elsewhere. Deficit tends to reduce the nation’s money supply, (monetary adjustment) increasing interest rates, which in turn reduces investment and income in the deficit nation and attrac ...
... Under fixed exchange rate system, devaluation is allowed only within narrow limits and adjustment must come from elsewhere. Deficit tends to reduce the nation’s money supply, (monetary adjustment) increasing interest rates, which in turn reduces investment and income in the deficit nation and attrac ...
Triangular Relation Foreign Direct Investments - Exchange Rate – Capital Market for the CEE Countries:
... analysis, meaning that under the influence of important foreign direct investments, the exchange rate tends to reflect an appreciation of the national currency; this effect can be remarked at the level of the other countries as well, but what it differentiates this impact is precisely the period of ...
... analysis, meaning that under the influence of important foreign direct investments, the exchange rate tends to reflect an appreciation of the national currency; this effect can be remarked at the level of the other countries as well, but what it differentiates this impact is precisely the period of ...
Robert Philip Flood Nancy Peregriin Marion Working Paper No. 500 1050
... under the FLEX regime, since both real and monetary foreign disturbances penetrate the small country via an interest-rate channel as well as a price channel. ...
... under the FLEX regime, since both real and monetary foreign disturbances penetrate the small country via an interest-rate channel as well as a price channel. ...
When Capital Inflows Come to a Sudden Stop: Consequences and
... international capital markets. Furthermore, given the common reliance on short-term debt financing, the public and private sectors in these countries are often asked to repay their existing debts on short notice. Even with the recent large-scale rescue packages, official financing only makes up for ...
... international capital markets. Furthermore, given the common reliance on short-term debt financing, the public and private sectors in these countries are often asked to repay their existing debts on short notice. Even with the recent large-scale rescue packages, official financing only makes up for ...
Currency Crises in Argentina - Asociación Argentina de Economía
... defending it. Policymakers usually have as many good reasons to defend the fixed exchange rate but also to abandon it. For example, if government has a large debt burden denominated in domestic currency, devaluation would evaporate part of the debt. Or, if the country is suffering high unemployment ...
... defending it. Policymakers usually have as many good reasons to defend the fixed exchange rate but also to abandon it. For example, if government has a large debt burden denominated in domestic currency, devaluation would evaporate part of the debt. Or, if the country is suffering high unemployment ...
MACROECONOMIC PRINCIPLES (ECON
... (peak) 12 / 01 (trough). The most recent economic peak was 12/07. That is when the current recession began. The economy appears to have reached a trough during the 3rd quarter of 2009 where real GDP increased 2.8 percent. The average growth in the first quarter of a recovery during the post WW II pe ...
... (peak) 12 / 01 (trough). The most recent economic peak was 12/07. That is when the current recession began. The economy appears to have reached a trough during the 3rd quarter of 2009 where real GDP increased 2.8 percent. The average growth in the first quarter of a recovery during the post WW II pe ...
Mankiw 5/e Chapter 9: Intro to Economic Fluctuations
... it announces a target value, and uses monetary policy to shift the LM curve as needed to attain its target rate. slide 3 ...
... it announces a target value, and uses monetary policy to shift the LM curve as needed to attain its target rate. slide 3 ...
Output and Exchange Rate in the Short Run
... level decreases the real money supply, increasing interest rates, causing the domestic currency to appreciate (a fall in E): the AA curve shifts down. 3. Changes in real money demand: if domestic residents prefer to hold a lower amount of real money balances, interest rates would fall, leading to a ...
... level decreases the real money supply, increasing interest rates, causing the domestic currency to appreciate (a fall in E): the AA curve shifts down. 3. Changes in real money demand: if domestic residents prefer to hold a lower amount of real money balances, interest rates would fall, leading to a ...
This PDF is a selection from an out-of-print volume from... Bureau of Economic Research
... that maximizes a "well-behaved" utility function defined with respect to the endogenous macro-variables. We did not, however, attempt to define such a utility function and use optimization techniques to determine the maximum value of the utility function. Rather, we looked at two separate "performan ...
... that maximizes a "well-behaved" utility function defined with respect to the endogenous macro-variables. We did not, however, attempt to define such a utility function and use optimization techniques to determine the maximum value of the utility function. Rather, we looked at two separate "performan ...
DISINFLATION AND BALANCE OF PAYMENTS IN THE TURKISH ECONOMY Erdem Ba
... Effects of Energy Prices Current Account Balance and the Effect of Energy Prices on Current Account Deficit * (2002 – 2007, ratio to GDP, percent) ...
... Effects of Energy Prices Current Account Balance and the Effect of Energy Prices on Current Account Deficit * (2002 – 2007, ratio to GDP, percent) ...
The Finnish Great Depression of the 1990s
... the sudden loss of the market for specialized exports to the USSR and the surge in the relative price of imported energy that resulted from the end of the barter trade of under-priced energy. Gorondichenko et al. (2012) consider the shock in an economy with several sectors, the Soviet, non-Soviet an ...
... the sudden loss of the market for specialized exports to the USSR and the surge in the relative price of imported energy that resulted from the end of the barter trade of under-priced energy. Gorondichenko et al. (2012) consider the shock in an economy with several sectors, the Soviet, non-Soviet an ...
DEGREE OF OPENNESS,1905-2000
... cycles in the terms of trade and in the volume of exports that were observed in the country coincided with the cycles in economic activity and with the most important turning points in the structure of domestic production. Conventional wisdom about Latin American describes the last part of the ninet ...
... cycles in the terms of trade and in the volume of exports that were observed in the country coincided with the cycles in economic activity and with the most important turning points in the structure of domestic production. Conventional wisdom about Latin American describes the last part of the ninet ...
The Money Supply
... banks are financial intermediaries. People who adopt this position say “Banks don’t need to get funds from depositors or elsewhere to make loans, they can simply create the money from nowhere. So they are not really financial intermediaries.” This thinking misses the next thing that happens after th ...
... banks are financial intermediaries. People who adopt this position say “Banks don’t need to get funds from depositors or elsewhere to make loans, they can simply create the money from nowhere. So they are not really financial intermediaries.” This thinking misses the next thing that happens after th ...
Financial Market in Latvia
... In recent years, significance of the financial sector has been gradually increasing both in the industrialized countries and transition economies. Perhaps the most important function of the financial sector is the transfer of savings to investment. The type of utilization of savings, however, is eve ...
... In recent years, significance of the financial sector has been gradually increasing both in the industrialized countries and transition economies. Perhaps the most important function of the financial sector is the transfer of savings to investment. The type of utilization of savings, however, is eve ...
INSTITUTE FOR MONETARY AND ECONOMIC STUDIES BANK OF
... also the difference in the state of the economy between the countries that adopted inflation targeting and Japan. Since the countries suffering from high inflation adopted inflation targeting as a disinflationary measure, there seemed to exist a clear policy path for achieving the goal, i.e. raise i ...
... also the difference in the state of the economy between the countries that adopted inflation targeting and Japan. Since the countries suffering from high inflation adopted inflation targeting as a disinflationary measure, there seemed to exist a clear policy path for achieving the goal, i.e. raise i ...
How policies and events affect an open economy.
... balance the supply and demand for dollars. At the equilibrium exchange rate, the demand for dollars to buy net exports exactly balances the supply of dollars to be exchanged into foreign currency to buy assets abroad. Principles of Macroeconomics: Ch. 18 ...
... balance the supply and demand for dollars. At the equilibrium exchange rate, the demand for dollars to buy net exports exactly balances the supply of dollars to be exchanged into foreign currency to buy assets abroad. Principles of Macroeconomics: Ch. 18 ...
Chapter 12
... central banks to cushion against financial instability. Assets include government bonds, currency, gold and accounts at the International Monetary Fund. Official foreign exchange intervention: Central banks buy or sell international reserves in private markets to affect macroeocnomic conditions ...
... central banks to cushion against financial instability. Assets include government bonds, currency, gold and accounts at the International Monetary Fund. Official foreign exchange intervention: Central banks buy or sell international reserves in private markets to affect macroeocnomic conditions ...
Econ 336 - Rutgers Economics
... 15) Which of the following statements is true about a vehicle currency? ...
... 15) Which of the following statements is true about a vehicle currency? ...
MACROECONOMIC POLiCiES AND EXCHANGE RATES
... more rapid rate of monetary expansion in one country, against the background of a stable demand for money, tends to depreciate the nominal exchange rate, and vice versa. This result is generally corroborated by empirical studies. Most theoretical models would predict that, in the long run, an incre ...
... more rapid rate of monetary expansion in one country, against the background of a stable demand for money, tends to depreciate the nominal exchange rate, and vice versa. This result is generally corroborated by empirical studies. Most theoretical models would predict that, in the long run, an incre ...
Periodism of Chinese Current Account Surplus
... rising cost of education, imperfect of pension, medical, social security system lead to increase in precautionary saving; For enterprises, due to the imperfect financial system, some non-state enterprises and small and medium-sized enterprise are hard to obtain capital through financing market, most ...
... rising cost of education, imperfect of pension, medical, social security system lead to increase in precautionary saving; For enterprises, due to the imperfect financial system, some non-state enterprises and small and medium-sized enterprise are hard to obtain capital through financing market, most ...
Lecture Slides on Chapter 19 of Krugman, et. al.
... adjustment of prices as gold (“specie”) flows into or out of a country, causing an adjustment in the flow of goods. – An inflow of gold tends to inflate prices. – An outflow of gold tends to deflate prices. – If a domestic country has a current account surplus in excess of the nonreserve financial a ...
... adjustment of prices as gold (“specie”) flows into or out of a country, causing an adjustment in the flow of goods. – An inflow of gold tends to inflate prices. – An outflow of gold tends to deflate prices. – If a domestic country has a current account surplus in excess of the nonreserve financial a ...
Section 6 - Qatar University
... the same line, Bernanke and Blinder (1989) stressed the issue of time lag in assessing the effectiveness of economic policy. They indicated that although policy change may affect money supply immediately, it takes several months to transmit the effects to the real output. A study conducted by Kretz ...
... the same line, Bernanke and Blinder (1989) stressed the issue of time lag in assessing the effectiveness of economic policy. They indicated that although policy change may affect money supply immediately, it takes several months to transmit the effects to the real output. A study conducted by Kretz ...
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.