This PDF is a selection from a published volume from... National Bureau of Economic Research
... prospective government deficits. To simplify our exposition we reduce the model to its essential elements: a money demand specification, a government budget constraint, a rule for exiting the fixed exchange rate regime, and an assumption about the nature of monetary policy after the devaluation. We ...
... prospective government deficits. To simplify our exposition we reduce the model to its essential elements: a money demand specification, a government budget constraint, a rule for exiting the fixed exchange rate regime, and an assumption about the nature of monetary policy after the devaluation. We ...
NBER WORKING PAPER SERIES MONETARY POLICIES IN INTERDEPENDENT ECONOMIES WITH STOCHASTIC DISTURBANCES:
... shifts require totally symmetric adjustments in the two economies. It can be ...
... shifts require totally symmetric adjustments in the two economies. It can be ...
East African Community: Pre-conditions for an Effective Monetary
... The traditional approach of deciding whether a set of countries should form a monetary union is to evaluate whether the countries constitute an OCA (Mundell, 1961; McKinnon, 1963). The standard question addressed is if the benefits of eliminating exchange rate fluctuations between member states out ...
... The traditional approach of deciding whether a set of countries should form a monetary union is to evaluate whether the countries constitute an OCA (Mundell, 1961; McKinnon, 1963). The standard question addressed is if the benefits of eliminating exchange rate fluctuations between member states out ...
IS-LM-BP Analysis
... you will see below, the degree of capital mobility has a bearing on the outcome of various fiscal and monetary policies. One final point regarding the BP curve has to do with what happens when the economy is above (or to the left) of the curve, and what happens when the economy is below (or to the r ...
... you will see below, the degree of capital mobility has a bearing on the outcome of various fiscal and monetary policies. One final point regarding the BP curve has to do with what happens when the economy is above (or to the left) of the curve, and what happens when the economy is below (or to the r ...
M-19
... Suppose that Wanda the Winetaster, an American, decides to buy a bottle of 1961 (a very good year) Château Lafite Rothschild to complete her wine cellar. If the price of the wine in France is 1,000 euros and the exchange rate is $1.08 to the euro, the wine will cost Wanda $1,080 ( 1,000 euros $1. ...
... Suppose that Wanda the Winetaster, an American, decides to buy a bottle of 1961 (a very good year) Château Lafite Rothschild to complete her wine cellar. If the price of the wine in France is 1,000 euros and the exchange rate is $1.08 to the euro, the wine will cost Wanda $1,080 ( 1,000 euros $1. ...
IS/LM/BP Open Economy Handout
... you will see below, the degree of capital mobility has a bearing on the outcome of various fiscal and monetary policies. One final point regarding the BP curve has to do with what happens when the economy is above (or to the left) of the curve, and what happens when the economy is below (or to the r ...
... you will see below, the degree of capital mobility has a bearing on the outcome of various fiscal and monetary policies. One final point regarding the BP curve has to do with what happens when the economy is above (or to the left) of the curve, and what happens when the economy is below (or to the r ...
A stable demand for money despite financial crisis: The case of
... respectively, but now we have imposed the null restriction that the foreign interest rate does not enter the first cointegrating vector of real money demand, and that real money demand does not enter the second cointegrating vector.iv In addition we also impose null restrictions on the feedback effe ...
... respectively, but now we have imposed the null restriction that the foreign interest rate does not enter the first cointegrating vector of real money demand, and that real money demand does not enter the second cointegrating vector.iv In addition we also impose null restrictions on the feedback effe ...
Central bank`s objectives and structure
... Note: One-off effects substantially decreased the stock of placements and in 2012 they relate to the assumption of shipyards loans by the Ministry of Finance and the transaction of one bank which, aiming to reduce its partly recoverable and irrecoverable placements transferred a portion of its claim ...
... Note: One-off effects substantially decreased the stock of placements and in 2012 they relate to the assumption of shipyards loans by the Ministry of Finance and the transaction of one bank which, aiming to reduce its partly recoverable and irrecoverable placements transferred a portion of its claim ...
The Political Economy of Exchange Rate Policy in the Caribbean
... determinants of exchange rate strategy because, in the past 38 years, member countries have experienced a variety of regimes including currency boards, a monetary union, pegs to the US dollar and sterling, a crawling peg, exchange rate auctions and freely floating exchange rates, with and without ce ...
... determinants of exchange rate strategy because, in the past 38 years, member countries have experienced a variety of regimes including currency boards, a monetary union, pegs to the US dollar and sterling, a crawling peg, exchange rate auctions and freely floating exchange rates, with and without ce ...
Chakriya Bowman Economies
... During the late 1980s and early 1990s, there was a global fascination with the establishment of Japan as a major player in the world economy. Everything from Japanese management techniques to Japanese fashion design became the subject of focus for the OECD economies, it is natural that economists an ...
... During the late 1980s and early 1990s, there was a global fascination with the establishment of Japan as a major player in the world economy. Everything from Japanese management techniques to Japanese fashion design became the subject of focus for the OECD economies, it is natural that economists an ...
CHAP1.WP (Word5)
... concerning policy effectiveness are almost the same as for the small open economy. These are summarized at the end of this subsection. Section 7-11 concludes the chapter by referring once again to the problem of trilemma. The case of the United States, whose reliance on flexible exchange rates allow ...
... concerning policy effectiveness are almost the same as for the small open economy. These are summarized at the end of this subsection. Section 7-11 concludes the chapter by referring once again to the problem of trilemma. The case of the United States, whose reliance on flexible exchange rates allow ...
FREE Sample Here
... collapse in the long run. C. was indeed responsible for the eventual collapse of the dollar-based gold-exchange system in the early 1970s. D. all of the above are correct ...
... collapse in the long run. C. was indeed responsible for the eventual collapse of the dollar-based gold-exchange system in the early 1970s. D. all of the above are correct ...
mmi14-Mueller 19106649 en
... equalize expected returns on different interest-bearing securities—reflecting reversibility risk due to the steady accumulation of public debt. Whether the economy is part of a currency union or pegging its exchange permanently is immaterial for our results if capital is perfectly mobile. Absent this ...
... equalize expected returns on different interest-bearing securities—reflecting reversibility risk due to the steady accumulation of public debt. Whether the economy is part of a currency union or pegging its exchange permanently is immaterial for our results if capital is perfectly mobile. Absent this ...
This PDF is a selection from an out-of-print volume from... of Economic Research
... of the economy’s intrinsic dynamics. A second source is private saving, which drives the stock of net foreign assets to its long-run level. Detailed discussion of the economy’s dynamic behavior is deferred until section 6.3. Here, I merely set out the structure of the economy. Under a crawling peg t ...
... of the economy’s intrinsic dynamics. A second source is private saving, which drives the stock of net foreign assets to its long-run level. Detailed discussion of the economy’s dynamic behavior is deferred until section 6.3. Here, I merely set out the structure of the economy. Under a crawling peg t ...
No Slide Title
... position is first created), "C" means translation at the current rate (prevailing on the date of consolidation). "Mixed H" refers to sums of terms added at various moments in time, at the then prevailing rate. "Average" means an average of daily or end-of-the-week or end-of-the-month rates over the ...
... position is first created), "C" means translation at the current rate (prevailing on the date of consolidation). "Mixed H" refers to sums of terms added at various moments in time, at the then prevailing rate. "Average" means an average of daily or end-of-the-week or end-of-the-month rates over the ...
This PDF is a selection from an out-of-print volume from... of Economic Research Volume Title: Exchange Rate Theory and Practice
... private agents do not treat the security holdings of the authorities as being implicitly a part of their own portfolios. Second, contemporaneous financial policy feedback rules can dampen the variance of employment caused by disturbances in the markets for goods and assets even though agents have ra ...
... private agents do not treat the security holdings of the authorities as being implicitly a part of their own portfolios. Second, contemporaneous financial policy feedback rules can dampen the variance of employment caused by disturbances in the markets for goods and assets even though agents have ra ...
Contents of the course - Solvay Brussels School
... A critique of the IMF approach – (5) The hypothesised cause of BOP problems • There is a concentration in the IMF programmes on demand deflation and financial market liberalisation. • The structuralist school; however, underlines other cause than those seen by the IMF. • Structuralists argue that d ...
... A critique of the IMF approach – (5) The hypothesised cause of BOP problems • There is a concentration in the IMF programmes on demand deflation and financial market liberalisation. • The structuralist school; however, underlines other cause than those seen by the IMF. • Structuralists argue that d ...
Fixed exchange rates
... people and public investments in Eastern Germany led to a large increase in demand and in the price level in Germany The Bundesbank reacted by adopting a restrictionary monetary policy. The result was a large increase in interest rates This was probably the right policy mix for Germany. For the othe ...
... people and public investments in Eastern Germany led to a large increase in demand and in the price level in Germany The Bundesbank reacted by adopting a restrictionary monetary policy. The result was a large increase in interest rates This was probably the right policy mix for Germany. For the othe ...
Review of Exchange Arrangements, Restrictions, and Controls
... To identify better the nature of the de facto exchange arrangements of currency unions, countries in these unions have been classified as of April 1, 2007 based on the exchange rate policies of the union, rather than the country, to reflect the external exchange arrangement of the union. In other wo ...
... To identify better the nature of the de facto exchange arrangements of currency unions, countries in these unions have been classified as of April 1, 2007 based on the exchange rate policies of the union, rather than the country, to reflect the external exchange arrangement of the union. In other wo ...
US Presidential Cycle and Foreign Exchange Market
... issue that has been overlooked in previous studies. Unlike the existing literature that mostly examines the relation between U.S. presidential cycle and stock returns, my paper is the first to formally test the relation between presidential terms and U.S. foreign exchange market. Understanding the p ...
... issue that has been overlooked in previous studies. Unlike the existing literature that mostly examines the relation between U.S. presidential cycle and stock returns, my paper is the first to formally test the relation between presidential terms and U.S. foreign exchange market. Understanding the p ...
Macroprudential policies, the long
... microeconomic focus, usually to deal with a market failure in a specific market that an individual bank or other financial firm will not, on its own, address. The simplifying assumption of partial equilibrium analysis is that such policies leave the economy-wide interest rate unchanged. They can rai ...
... microeconomic focus, usually to deal with a market failure in a specific market that an individual bank or other financial firm will not, on its own, address. The simplifying assumption of partial equilibrium analysis is that such policies leave the economy-wide interest rate unchanged. They can rai ...
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.