The Exchange Rate In A Dynamic Optimizing Business Cycle Model With Nominal Rigidities
Download The Exchange Rate In A Dynamic Optimizing Business Cycle Model With Nominal Rigidities full books in PDF, epub, and Kindle. Read online free The Exchange Rate In A Dynamic Optimizing Business Cycle Model With Nominal Rigidities ebook anywhere anytime directly on your device. Fast Download speed and no annoying ads. We cannot guarantee that every ebooks is available!
The Exchange Rate in a Dynamic-Optimizing Current Account Model with Nominal Rigidities
Author | : Robert Miguel W. K. Kollman |
Publisher | : International Monetary Fund |
Total Pages | : 52 |
Release | : 1997-01-01 |
Genre | : Business & Economics |
ISBN | : 1451928521 |
Download The Exchange Rate in a Dynamic-Optimizing Current Account Model with Nominal Rigidities Book in PDF, Epub and Kindle
This paper studies dynamic-optimizing model of a semi-small open economy with sticky nominal prices and wages. The model exhibits exchange rate overshooting in response to money supply shocks. The predicted variability of nominal and real exchange rates is roughly consistent with that of G-7 effective exchange rates during the post-Bretton Woods era. The model predicts that a positive domestic money supply shock lowers the domestic nominal interest rate, that it raises output and that it leads to a nominal and real depreciation of the country’s currency. Increases in domestic labor productivity and in the world interest rate too are predicted to induce a nominal and real exchange rate depreciation.