PPT chapter 14
... • Examples of goods not traded internationally are: – those with large transportation costs, like hairdressing services and heavy construction materials – those that cannot be traded, like agricultural land and ...
... • Examples of goods not traded internationally are: – those with large transportation costs, like hairdressing services and heavy construction materials – those that cannot be traded, like agricultural land and ...
NBER WORKING PAPER SERIES ENDOGENOUS EXCHANGE RATE PASS-THROUGH Michael B. Devereux
... then pass-through from exchange rate changes to final consumers will be complete, and imported goods will display considerable price flexibility. On the other hand, if goods prices are fixed in consumer’s currency (LCP, or ‘local currency pricing’), there is no pass-through at all, and imported good ...
... then pass-through from exchange rate changes to final consumers will be complete, and imported goods will display considerable price flexibility. On the other hand, if goods prices are fixed in consumer’s currency (LCP, or ‘local currency pricing’), there is no pass-through at all, and imported good ...
Regional Monetary Cooperation and Growth
... progressively replace the United States dollar as the invoicing currency of intra-regional trade. It is also seen as a tool not only for the strengthening of commercial ties, but also to move forward in the building of a new regional financial architecture. ...
... progressively replace the United States dollar as the invoicing currency of intra-regional trade. It is also seen as a tool not only for the strengthening of commercial ties, but also to move forward in the building of a new regional financial architecture. ...
NBER WORKING PAPER SERIES HOW WELL CAN THE NEW OPEN ECONOMY
... literature. One such controversy deals with the nature of price stickiness. While Betts and Devereux (2000) have argued that stickiness in the local currency of the buyer improves the model’s ability to explain certain stylized facts regarding the exchange rate, Obstfeld and Rogoff (2000) have argu ...
... literature. One such controversy deals with the nature of price stickiness. While Betts and Devereux (2000) have argued that stickiness in the local currency of the buyer improves the model’s ability to explain certain stylized facts regarding the exchange rate, Obstfeld and Rogoff (2000) have argu ...
23 January 2002 - European Parliament
... The opinions expressed in this document are the sole responsability of the author and do not necessarily represent the official position of the European Parliament. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the publisher is given ...
... The opinions expressed in this document are the sole responsability of the author and do not necessarily represent the official position of the European Parliament. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the publisher is given ...
The Coming U.S. Interest Rate Tightening Cycle: Smooth Sailing or
... markets are strengthening. While the recovery remains fragile in other major advanced economies, it has gradually firmed since 2013 (Figure 1). Despite the recent volatility, global long-term interest rates remain low, and the European Central Bank and the Bank of Japan are continuing to employ exce ...
... markets are strengthening. While the recovery remains fragile in other major advanced economies, it has gradually firmed since 2013 (Figure 1). Despite the recent volatility, global long-term interest rates remain low, and the European Central Bank and the Bank of Japan are continuing to employ exce ...
Risky Business An Empirical Analysis of Foreign Exchange Risk
... the first empirical study to measure the volume, extent, and nature of MFIs’ foreign exchange risk. It presents a snapshot, based on 2008 financial data of over 300 MFIs worldwide, representing approximately 60% of the total assets in the industry. By coincidence, 2008 turned out to be one of the mo ...
... the first empirical study to measure the volume, extent, and nature of MFIs’ foreign exchange risk. It presents a snapshot, based on 2008 financial data of over 300 MFIs worldwide, representing approximately 60% of the total assets in the industry. By coincidence, 2008 turned out to be one of the mo ...
Competition in Currency The Potential for Private Money Executive Summary
... a commodity or basket of commodities. A commodity-based currency would likely be most valuable for international transactions. International traders rely on the stability of exchange rates among nations, which in turn rely on a vast array of variables that are affected by each country’s economic per ...
... a commodity or basket of commodities. A commodity-based currency would likely be most valuable for international transactions. International traders rely on the stability of exchange rates among nations, which in turn rely on a vast array of variables that are affected by each country’s economic per ...
This PDF is a selection from a published volume from... Research Volume Title: International Dimensions of Monetary Policy
... the potential to significantly reduce the central bank’s ability to influence the economy. In section 1.2.2 of his chapter, as part of his analysis of possible effects of globalization on the LM curve, Woodford discusses the possibility of multiple currencies circulating in a country. He concludes th ...
... the potential to significantly reduce the central bank’s ability to influence the economy. In section 1.2.2 of his chapter, as part of his analysis of possible effects of globalization on the LM curve, Woodford discusses the possibility of multiple currencies circulating in a country. He concludes th ...
NBER WORKING PAPER SERIES THE DOLLAR AND ITS DISCONTENTS Olivier Jeanne
... corporate bonds. Foreign private and official investors, who had diversified their holdings of US securities in the decades preceding the crisis, rushed back to the safety of Treasury debt after 2008. Figure 1 shows the shares of foreign holdings of US debt securities respectively invested in Treasu ...
... corporate bonds. Foreign private and official investors, who had diversified their holdings of US securities in the decades preceding the crisis, rushed back to the safety of Treasury debt after 2008. Figure 1 shows the shares of foreign holdings of US debt securities respectively invested in Treasu ...
13-102 Fixed Exchange Rates
... economy; the LM curve and FE line are the same – Note that we don’t use the AD-AS model because we need to know what happens to the real interest rate, which has an important impact on the exchange rate – The IS curve is affected because net exports are part of the demand for goods – The IS curve re ...
... economy; the LM curve and FE line are the same – Note that we don’t use the AD-AS model because we need to know what happens to the real interest rate, which has an important impact on the exchange rate – The IS curve is affected because net exports are part of the demand for goods – The IS curve re ...
The Domestic Institutional Sources of Monetary Integration in the
... On the one hand, a fixed regime eliminates nominal volatility, which benefits some groups more than others; on the other, by altering the strategic environment in which wage-setting takes place, it might also affect the real exchange rate -harming some sectors but benefitting others. Because the puzz ...
... On the one hand, a fixed regime eliminates nominal volatility, which benefits some groups more than others; on the other, by altering the strategic environment in which wage-setting takes place, it might also affect the real exchange rate -harming some sectors but benefitting others. Because the puzz ...
An Analysis of the Appreciation of the Chinese Currency and
... With the appreciation of the currency, the net exports should decrease. Net exports = Saving – Domestic Investments. McKinnon (2013) said that a newly appreciated Renminbi would turn China into a more expensive place for international investors, so that domestic investment would fall. So, according ...
... With the appreciation of the currency, the net exports should decrease. Net exports = Saving – Domestic Investments. McKinnon (2013) said that a newly appreciated Renminbi would turn China into a more expensive place for international investors, so that domestic investment would fall. So, according ...
Prologue -- Tearing Down Walls -- History of the International
... His initial plan noted that during “the last twenty years” (that is, throughout the interwar period), countries had often imposed protectionist policies because they lacked adequate gold reserves, and the plan warned that the same problems would arise and would constitute a major barrier to the grow ...
... His initial plan noted that during “the last twenty years” (that is, throughout the interwar period), countries had often imposed protectionist policies because they lacked adequate gold reserves, and the plan warned that the same problems would arise and would constitute a major barrier to the grow ...
Synthetic Commodity Money
... policy only, it is subject to adjustment at the will of the monetary authorities or, if those authorities are bound by a monetary rule, at that of the legislature. Consequently, although a fiat money can be managed so as to not only preserve its purchasing power over time, but also so as to achieve ...
... policy only, it is subject to adjustment at the will of the monetary authorities or, if those authorities are bound by a monetary rule, at that of the legislature. Consequently, although a fiat money can be managed so as to not only preserve its purchasing power over time, but also so as to achieve ...
I F M What Is the
... because both the Danish and Japanese governments are committed to the convertibility of their respective currencies. Neither country restricts the exchange of its national currency into another national money, and this greatly facilitates international trade. Fortunately, widespread convertibility n ...
... because both the Danish and Japanese governments are committed to the convertibility of their respective currencies. Neither country restricts the exchange of its national currency into another national money, and this greatly facilitates international trade. Fortunately, widespread convertibility n ...
Working Paper 12-10: The Dollar and Its Discontents
... corporate bonds. Foreign private and official investors, who had diversified their holdings of US securities in the decades preceding the crisis, rushed back to the safety of Treasury debt after 2008. Figure 1 shows the shares of foreign holdings of US debt securities respectively invested in Treasu ...
... corporate bonds. Foreign private and official investors, who had diversified their holdings of US securities in the decades preceding the crisis, rushed back to the safety of Treasury debt after 2008. Figure 1 shows the shares of foreign holdings of US debt securities respectively invested in Treasu ...
Economic Papers. 173. Latin America`s integration processes in the
... is signing FTAs with each of the NAFTA countries but also has a FTA with Mercosur and has in the past expressed interest in joining Mercosur. There are also a series of other bilateral FTAs connecting the countries in the continent. In addition, the largest Latin American countries (Mexico, Mercosur ...
... is signing FTAs with each of the NAFTA countries but also has a FTA with Mercosur and has in the past expressed interest in joining Mercosur. There are also a series of other bilateral FTAs connecting the countries in the continent. In addition, the largest Latin American countries (Mexico, Mercosur ...
This PDF is a selection from a published volume from... National Bureau of Economic Research
... patterns of GDP growth rates between two subgroups of the currency crisis episodes, one with conditional financial assistance from the International Monetary Fund (IMF) and the other without. We find that the adjustment process was much sharper in the group of the crisis episodes with the IMF progra ...
... patterns of GDP growth rates between two subgroups of the currency crisis episodes, one with conditional financial assistance from the International Monetary Fund (IMF) and the other without. We find that the adjustment process was much sharper in the group of the crisis episodes with the IMF progra ...
Effectiveness of devaluation in achieving Internal and External
... Indicated in 1990 a World Bank report: “All over Africa, countries are adopting SAP with the hope of arresting decades of economic deterioration. This deterioration has been attributed, among other things, to in appropriate trade and payment policies, such as overvalued exchange reassess and exchan ...
... Indicated in 1990 a World Bank report: “All over Africa, countries are adopting SAP with the hope of arresting decades of economic deterioration. This deterioration has been attributed, among other things, to in appropriate trade and payment policies, such as overvalued exchange reassess and exchan ...
Currency war
Currency war, also known as competitive devaluation, is a condition in international affairs where countries compete against each other to achieve a relatively low exchange rate for their own currency. As the price to buy a country's currency falls so too does the price of exports. Imports to the country become more expensive. So domestic industry, and thus employment, receives a boost in demand from both domestic and foreign markets. However, the price increase for imports can harm citizens' purchasing power. The policy can also trigger retaliatory action by other countries which in turn can lead to a general decline in international trade, harming all countries.Competitive devaluation has been rare through most of history as countries have generally preferred to maintain a high value for their currency. Countries have generally allowed market forces to work, or have participated in systems of managed exchanges rates. An exception occurred when currency war broke out in the 1930s. As countries abandoned the Gold Standard during the Great Depression, they used currency devaluations to stimulate their economies. Since this effectively pushes unemployment overseas, trading partners quickly retaliated with their own devaluations. The period is considered to have been an adverse situation for all concerned, as unpredictable changes in exchange rates reduced overall international trade.According to Guido Mantega, the Brazilian Minister for Finance, a global currency war broke out in 2010. This view was echoed by numerous other government officials and financial journalists from around the world. Other senior policy makers and journalists suggested the phrase ""currency war"" overstated the extent of hostility. With a few exceptions, such as Mantega, even commentators who agreed there had been a currency war in 2010 generally concluded that it had fizzled out by mid-2011.States engaging in possible competitive devaluation since 2010 have used a mix of policy tools, including direct government intervention, the imposition of capital controls, and, indirectly, quantitative easing. While many countries experienced undesirable upward pressure on their exchange rates and took part in the ongoing arguments, the most notable dimension of the 2010–11 episode was the rhetorical conflict between the United States and China over the valuation of the yuan. In January 2013, measures announced by Japan which were expected to devalue its currency sparked concern of a possible second 21st century currency war breaking out, this time with the principal source of tension being not China versus the US, but Japan versus the Eurozone. By late February, concerns of a new outbreak of currency war had been mostly allayed, after the G7 and G20 issued statements committing to avoid competitive devaluation. After the European Central Bank launched a fresh programme of quantitative easing in January 2015, there was once again an intensification of discussion about currency war.