Dynamics of Firms and Trade in General Equilibrium
... Firms choose which products to produce and which products to export. Thus Eaton-Kortum and Melitz style extensive margin adjustment is mainly at the product level. This …rm and product level heterogeneity helps explain the weak relationships among size, the export share and pro…tability in our …rm-l ...
... Firms choose which products to produce and which products to export. Thus Eaton-Kortum and Melitz style extensive margin adjustment is mainly at the product level. This …rm and product level heterogeneity helps explain the weak relationships among size, the export share and pro…tability in our …rm-l ...
“Carry Trade” Model of Commodity Prices
... The phrase “carry trade” is today primarily associated with speculation in international fixed-income markets, where the spot price of concern is the price of foreign exchange and the “cost of carry” is the international difference in interest rates. There is perhaps an irony here, because the origi ...
... The phrase “carry trade” is today primarily associated with speculation in international fixed-income markets, where the spot price of concern is the price of foreign exchange and the “cost of carry” is the international difference in interest rates. There is perhaps an irony here, because the origi ...
2011 Article I Swedish house prices in an international perspective
... The house price boom that started in the mid 1990s is unprecedented in recent history, both in length and magnitude. Figure 1 illustrates the price development for a selection of countries. In all cases, prices more than doubled between 1995 and the peak in 2007-08. In Great Britain house prices inc ...
... The house price boom that started in the mid 1990s is unprecedented in recent history, both in length and magnitude. Figure 1 illustrates the price development for a selection of countries. In all cases, prices more than doubled between 1995 and the peak in 2007-08. In Great Britain house prices inc ...
NBER WORKING PAPER SERIES WHAT HURTS MOST? Carmen M. Reinhart
... to enforce some corridor on bilateral exchange rates. However, except to the extent that such intervention tends to signal future changes in domestic monetary policy, researchers have found little empirical support that sterilized intervention in industrial countries is effective.3 Second, national ...
... to enforce some corridor on bilateral exchange rates. However, except to the extent that such intervention tends to signal future changes in domestic monetary policy, researchers have found little empirical support that sterilized intervention in industrial countries is effective.3 Second, national ...
Shocks and policy responses in the open economy
... 6.1 implies that price competitiveness has fallen and real wages have risen. Real wages have risen because the nominal appreciation cuts the price (in domestic currency terms) of imported final goods ). In the medium run, wage setters will react to in the consumption bundle (i.e. this. With real wag ...
... 6.1 implies that price competitiveness has fallen and real wages have risen. Real wages have risen because the nominal appreciation cuts the price (in domestic currency terms) of imported final goods ). In the medium run, wage setters will react to in the consumption bundle (i.e. this. With real wag ...
This PDF is a selection from a published volume from... Economic Research Volume Title: NBER International Seminar on Macroeconom
... long‐term real exchange rates, current accounts, and net foreign assets and highlighting factors that are more likely to be specific to these countries. The rise and persistence of large external imbalances in recent years have renewed interest in this area from an empirical and theoretical perspect ...
... long‐term real exchange rates, current accounts, and net foreign assets and highlighting factors that are more likely to be specific to these countries. The rise and persistence of large external imbalances in recent years have renewed interest in this area from an empirical and theoretical perspect ...
Factors Influencing Emerging Market Central Banks` Decision
... three IMF CGER methodologies) and reserve adequacy ratios (reserves-to short-term debt and reserves-to-M2). They find that that the exchange rate misalignment variable has a positive coefficient (i.e. more overvaluation leads to an increase in net FX purchases) and is statistically significant in si ...
... three IMF CGER methodologies) and reserve adequacy ratios (reserves-to short-term debt and reserves-to-M2). They find that that the exchange rate misalignment variable has a positive coefficient (i.e. more overvaluation leads to an increase in net FX purchases) and is statistically significant in si ...
NBER WORKING PAPER SERIES MONETARY UNIONS, EXTERNAL SHOCKS AND ECONOMIC
... measures newly independent countries took during the nineteenth and twentieth century was to establish their own national currencies. In his well-known article on optimal currency areas Mundell (1961) cited the following quote from John Stuart Mill: “[A]lmost all independent nations choose to assert ...
... measures newly independent countries took during the nineteenth and twentieth century was to establish their own national currencies. In his well-known article on optimal currency areas Mundell (1961) cited the following quote from John Stuart Mill: “[A]lmost all independent nations choose to assert ...
When and Why Worry About Real Exchange Rate Appreciation?
... services that rely on unskilled labor. Banking on the latter, an export-led growth model is based on making an economy grow through exporting manufactures, which will raise a country’s wealth much faster than by closing the domestic manufacturing markets and export raw materials only, allowing the c ...
... services that rely on unskilled labor. Banking on the latter, an export-led growth model is based on making an economy grow through exporting manufactures, which will raise a country’s wealth much faster than by closing the domestic manufacturing markets and export raw materials only, allowing the c ...
This PDF is a selection from a published volume from... Research Volume Title: International Dimensions of Monetary Policy
... These include: (a) weak public sector financial management; (b) weak financial sector institutions and markets; (c) low monetary policy credibility; (d) extensive dollarization of financial liabilities; and (e) vulnerability to sharp changes in capital flows and international investor sentiment. In ...
... These include: (a) weak public sector financial management; (b) weak financial sector institutions and markets; (c) low monetary policy credibility; (d) extensive dollarization of financial liabilities; and (e) vulnerability to sharp changes in capital flows and international investor sentiment. In ...
Jim2 Multicurrency - Happen Business Accounting Software
... “Out of Date” warnings on each Currency to ensure accuracy and encourage vigilance when dealing with the volatility of foreign exchange. Jim2 Multicurrency removes any need for separate Debtor/Creditor identities to trade in multiple currencies. The suite of practical documents and professional busi ...
... “Out of Date” warnings on each Currency to ensure accuracy and encourage vigilance when dealing with the volatility of foreign exchange. Jim2 Multicurrency removes any need for separate Debtor/Creditor identities to trade in multiple currencies. The suite of practical documents and professional busi ...
World Economic Outlook, October 2015, Chapter 3: Exchange Rates
... with stronger domestic demand experiencing appreciation. Compare this with another example, in which the exchange rate change is not driven by domestic demand, but reflects an unexpected shift in investor preferences for U.S.-dollar-denominated assets. The behavior of domestic demand in the two exam ...
... with stronger domestic demand experiencing appreciation. Compare this with another example, in which the exchange rate change is not driven by domestic demand, but reflects an unexpected shift in investor preferences for U.S.-dollar-denominated assets. The behavior of domestic demand in the two exam ...
Forecasting commodity currencies: the role of
... (MIDAS) framework, each daily observation on price fluctuations can have a different weight or impact on the end-of-month observation on the exchange rate change. The MIDAS regression is a simple, parsimonious, and flexible modeling approach that allows the variables entering a time series regressio ...
... (MIDAS) framework, each daily observation on price fluctuations can have a different weight or impact on the end-of-month observation on the exchange rate change. The MIDAS regression is a simple, parsimonious, and flexible modeling approach that allows the variables entering a time series regressio ...
International Debt Deleveraging Luca Fornaro This draft: November 2013 First draft: November 2012
... model without nominal rigidities. I then analyze the case of a monetary union with nominal wage rigidities. In both versions of the model, the process of debt reduction generates a fall in the world interest rate, which overshoots its long run value. The drop in the world interest rate is due to two ...
... model without nominal rigidities. I then analyze the case of a monetary union with nominal wage rigidities. In both versions of the model, the process of debt reduction generates a fall in the world interest rate, which overshoots its long run value. The drop in the world interest rate is due to two ...
Purchasing power parity
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Purchasing power parity (PPP) is a component of some economic theories and is a technique used to determine the relative value of different currencies.Theories that invoke purchasing power parity assume that in some circumstances (for example, as a long-run tendency) it would cost exactly the same number of, say, US dollars to buy euros and then to use the proceeds to buy a market basket of goods as it would cost to use those dollars directly in purchasing the market basket of goods.The concept of purchasing power parity allows one to estimate what the exchange rate between two currencies would have to be in order for the exchange to be at par with the purchasing power of the two countries' currencies. Using that PPP rate for hypothetical currency conversions, a given amount of one currency thus has the same purchasing power whether used directly to purchase a market basket of goods or used to convert at the PPP rate to the other currency and then purchase the market basket using that currency. Observed deviations of the exchange rate from purchasing power parity are measured by deviations of the real exchange rate from its PPP value of 1.PPP exchange rates help to minimize misleading international comparisons that can arise with the use of market exchange rates. For example, suppose that two countries produce the same physical amounts of goods as each other in each of two different years. Since market exchange rates fluctuate substantially, when the GDP of one country measured in its own currency is converted to the other country's currency using market exchange rates, one country might be inferred to have higher real GDP than the other country in one year but lower in the other; both of these inferences would fail to reflect the reality of their relative levels of production. But if one country's GDP is converted into the other country's currency using PPP exchange rates instead of observed market exchange rates, the false inference will not occur.