NBER WORKING PAPER SERIES MONETARY POLICY IN THE OPEN ECONOMY REVISITED:
... The modern case for flexible exchange rates goes back to Friedman (1953). Real countryspecific productivity or demand shocks require adjustment of relative price levels between countries. If nominal prices adjusted quickly, Friedman argues, the choice of exchange-rate regime would be irrelevant bec ...
... The modern case for flexible exchange rates goes back to Friedman (1953). Real countryspecific productivity or demand shocks require adjustment of relative price levels between countries. If nominal prices adjusted quickly, Friedman argues, the choice of exchange-rate regime would be irrelevant bec ...
QE Equivalence to Interest Rate Policy: Implications for Exit
... given central bank’s balance sheet, to obtain a desired monetary policy stance. Or, in standard monetary policy analysis words, how many percentage points must be added to a standard Taylor rule rate for a given CB’s balance sheet? In response to the financial crisis, CBs have dramatically increased ...
... given central bank’s balance sheet, to obtain a desired monetary policy stance. Or, in standard monetary policy analysis words, how many percentage points must be added to a standard Taylor rule rate for a given CB’s balance sheet? In response to the financial crisis, CBs have dramatically increased ...
The Equilibrium Exchange Rate: Alternative Concepts and
... 3. Broadly speaking, two classes of empirical exchange rate models have been used in empirical work that relates the equilibrium real exchange rate to a set of economic fundamentals: (1) models that are based on the notion of internal and external balance; and (2) models based on the estimation of a ...
... 3. Broadly speaking, two classes of empirical exchange rate models have been used in empirical work that relates the equilibrium real exchange rate to a set of economic fundamentals: (1) models that are based on the notion of internal and external balance; and (2) models based on the estimation of a ...
Some hypotheses related to the mexican 1994
... From a major devaluation and a two-tiered exchange rate adopted at the end of 1982, the two exchange rates engaged into a gradual convergence path and, eventually, into a crawling peg. The 1986 terms of trade collapse imposed the adoption of new emergency measures that included an inflation-adjusted ...
... From a major devaluation and a two-tiered exchange rate adopted at the end of 1982, the two exchange rates engaged into a gradual convergence path and, eventually, into a crawling peg. The 1986 terms of trade collapse imposed the adoption of new emergency measures that included an inflation-adjusted ...
The Effects of Exchange Rate Volatility on Exports
... In particular, previous empirical researchers have examined how the effect of both real and nominal exchange rate volatility on international trade depends on various factors. The overall evidence is best characterized as mixed as the results are sensitive to the choices of sample period, model spe ...
... In particular, previous empirical researchers have examined how the effect of both real and nominal exchange rate volatility on international trade depends on various factors. The overall evidence is best characterized as mixed as the results are sensitive to the choices of sample period, model spe ...
Money as a Medium of Exchange
... are prepared to hold it temporarily at any rate in its capacity of a store of value. 8 ...
... are prepared to hold it temporarily at any rate in its capacity of a store of value. 8 ...
Analysis of Exchange Rate Fluctuations: A Study of PKR VS USD
... Vergil (2003) examined the association among exchange rate and macroeconomic variables inside Turkey and the European Union by means of quarterly data from 1990:1 to 2000:12. The results of Vergil’s study demonstrate that real exports in Turkey are strongly affected through exchange rate volatility. ...
... Vergil (2003) examined the association among exchange rate and macroeconomic variables inside Turkey and the European Union by means of quarterly data from 1990:1 to 2000:12. The results of Vergil’s study demonstrate that real exports in Turkey are strongly affected through exchange rate volatility. ...
A Suggested Monetary Policy for Brazil
... return as unstable debt dynamics kick in. There are four equilibria in figure 2. Equilibrium A is the stable “good” equilibrium with low interest rates. Equilibrium B has a low interest rate but is unstable. Equilibrium C is the stable “bad” equilibrium with high interest rates, and equilibrium D is ...
... return as unstable debt dynamics kick in. There are four equilibria in figure 2. Equilibrium A is the stable “good” equilibrium with low interest rates. Equilibrium B has a low interest rate but is unstable. Equilibrium C is the stable “bad” equilibrium with high interest rates, and equilibrium D is ...
Working Paper 113 - Lessons from Italian Monetary Unification
... extended far beyond ordinary scholarly courtesy. ...
... extended far beyond ordinary scholarly courtesy. ...
A Portfolio Theory of International Capital Flows Michael B. Devereux
... (1997), eliminating exchange rate movements by a fully pegged exchange rate, or a single currency area would reduce welfare, so would the elimination of nominal assets which operate as a risk-sharing mechanism. By contrast, the model implies a unique welfare maximizing monetary rule for each country ...
... (1997), eliminating exchange rate movements by a fully pegged exchange rate, or a single currency area would reduce welfare, so would the elimination of nominal assets which operate as a risk-sharing mechanism. By contrast, the model implies a unique welfare maximizing monetary rule for each country ...
Working Paper No. 288 - Financial Performance and
... In May 2013, then Fed chairman Ben Bernanke mentioned in congressional testimony that the Fed would begin to curtail, or "taper", the asset purchase program commonly known as QE3. In subsequent post-meeting statements, the Fed rea¢ rmed their commitment to tapering the asset purchase program. Many h ...
... In May 2013, then Fed chairman Ben Bernanke mentioned in congressional testimony that the Fed would begin to curtail, or "taper", the asset purchase program commonly known as QE3. In subsequent post-meeting statements, the Fed rea¢ rmed their commitment to tapering the asset purchase program. Many h ...
How do UK-based foreign exchange dealers think their market
... There is no consensus among traders on a wide range of important issues relating to fundamental value and the determinants of exchange rate movements. The results also suggest a new answer to an old puzzle. The concept of purchasing power parity (PPP) as a measure of an exchange rate’s fundamental v ...
... There is no consensus among traders on a wide range of important issues relating to fundamental value and the determinants of exchange rate movements. The results also suggest a new answer to an old puzzle. The concept of purchasing power parity (PPP) as a measure of an exchange rate’s fundamental v ...
Lectures 6
... a question: What determines those price levels? • Monetary theory supplies an answer: in the long run, price levels are determined in each country by the relative demand and supply of money. ...
... a question: What determines those price levels? • Monetary theory supplies an answer: in the long run, price levels are determined in each country by the relative demand and supply of money. ...
The Long or Short of it: Determinants of Foreign Currency
... format of Calvo-style contracts. In contrast to the other papers, a monetary policy rule is specified that adjusts the interest rate in response to inflation. (In this setting, a positive domestic productivity shock causes a nominal exchange rate depreciation - accordingly, the optimal hedge is for ...
... format of Calvo-style contracts. In contrast to the other papers, a monetary policy rule is specified that adjusts the interest rate in response to inflation. (In this setting, a positive domestic productivity shock causes a nominal exchange rate depreciation - accordingly, the optimal hedge is for ...
NBER WORKING PAPER SERIES ECONOMIC LIBERALIZATION AND THE EQUILIBRIUM REAL EXCHANGE RATE
... the initial real exchange rate is at its equilibrium level. Then, in this context, changes in the RER induced by exogenous shock should be interpreted as a change in the equilibrium real exchange rate.16 The modelling strategy is to first analyze how changes in the tariff ...
... the initial real exchange rate is at its equilibrium level. Then, in this context, changes in the RER induced by exogenous shock should be interpreted as a change in the equilibrium real exchange rate.16 The modelling strategy is to first analyze how changes in the tariff ...
CONCLUSIONS: GLOBALISATION AND THE END OF THE NATION
... Frieden greatly contributed to the development of a distributional politics approach to exchange rate policymaking from within a two-level game theoretical framework (Frieden and Stein 2001; Frieden et al. 2010, 2005, 2001; Frieden 2009, 2004, 2002, 2001, 2000, 1999, 1998a, 1998b, 1997a, 1997b, 1996 ...
... Frieden greatly contributed to the development of a distributional politics approach to exchange rate policymaking from within a two-level game theoretical framework (Frieden and Stein 2001; Frieden et al. 2010, 2005, 2001; Frieden 2009, 2004, 2002, 2001, 2000, 1999, 1998a, 1998b, 1997a, 1997b, 1996 ...
From Great Depression to Great Recession
... Fifteenth Jacques Polak Annual Research Conference. Nor are “currency wars,” a coinage we hear all too often today, a new phenomenon—the interwar period was characterized by a disastrous combination of competitive devaluations, exchange restrictions, and trade barriers. In addition, the 1930s saw a ...
... Fifteenth Jacques Polak Annual Research Conference. Nor are “currency wars,” a coinage we hear all too often today, a new phenomenon—the interwar period was characterized by a disastrous combination of competitive devaluations, exchange restrictions, and trade barriers. In addition, the 1930s saw a ...
Review of Exchange Arrangements, Restrictions, and Controls
... Based on current information, this means that the Communauté Financière d’Afrique and Coopèration Financière en Afrique Centrale (CFA) franc zone countries are since April 1, 2007, classified as fixed pegs (to the euro), the euro countries are classified as an independent float, and the Eastern Cari ...
... Based on current information, this means that the Communauté Financière d’Afrique and Coopèration Financière en Afrique Centrale (CFA) franc zone countries are since April 1, 2007, classified as fixed pegs (to the euro), the euro countries are classified as an independent float, and the Eastern Cari ...
Lecture 7 Money Commercial Banking and Monetary Policy
... As a result, banks will have to hold less money in RR and keep more money in ER. To lend the additional ER, banks will lower the rate of interest on business loans. ...
... As a result, banks will have to hold less money in RR and keep more money in ER. To lend the additional ER, banks will lower the rate of interest on business loans. ...
Output and Exchange Rate in the Short Run
... Real exchange rate: prices of foreign products relative to the prices of domestic products, both measured in domestic currency: EP*/P As the prices of foreign products rise relative to those of domestic products, expenditure on domestic products rises and expenditure on foreign products falls. ...
... Real exchange rate: prices of foreign products relative to the prices of domestic products, both measured in domestic currency: EP*/P As the prices of foreign products rise relative to those of domestic products, expenditure on domestic products rises and expenditure on foreign products falls. ...
Monetary unions, external shocks and economic performance: A Latin American perspective
... works on OCA in Latin America). More recently, an important body of work has argued that the traditional OCA criteria are endogenous to the monetary regime. In particular, the degree of trade and financial integration will tend to increase in countries that share a common currency.5 In Table 1 I pre ...
... works on OCA in Latin America). More recently, an important body of work has argued that the traditional OCA criteria are endogenous to the monetary regime. In particular, the degree of trade and financial integration will tend to increase in countries that share a common currency.5 In Table 1 I pre ...