Essays on Rational Expectations and Flexible Exchange Rates

Cover -- Half Title -- Title -- Copyright -- Original Title -- Original Copyright -- Contents -- I. INTRODUCTION AND OVERVIEW -- 1.1 Introduction -- 1.2 International Transmission of Economic Disturbances -- 1.3 Real Exchange Rate Models -- 1.4 The Exchange Rate and the Terms of Trade -- 1.5 Deviations from Purchasing Power Parity -- II. FLUCTUATING EXCHANGE RATES AND THE INTERNATIONAL TRANSMISSION OF ECONOMIC DISTURBANCES -- 2.1 Introduction -- 2.2 A Stochastic Model of Exchange Rate Determination -- 2.3 Output and the Exchange Rate Under Full Current Information -- 2.4 Characteristics of the Solutions for ẽt and ỹt -- 2.5 The Impact of Imperfect Information -- 2.6 Monetary Policy and the Exchange Rate -- 2.7 Sources of World Price Movements -- 2 . 8 Exchange Rate Variability -- 2.9 Concluding Comments -- III. "REAL" AND NOMINAL EXCHANGE RATES IN AN UNCERTAIN WORLD: THE TRADED NON-TRADED GOODS NEXUS -- 3.1 Introduction -- 3.2 Traded, Non-Traded Goods: A Stochastic Equilibrium Model -- 3.3 A Formal Solution and the Formation of Expectations -- 3.4 Prices and Outputs with Full Information -- 3.5 Impact of Incomplete Current Information -- 3.6 Conclusions and Extensions -- IV. CYCLICAL VARIATIONS OF THE EXCHANGE RATE AND THE TERMS OF TRADE -- 4.1 Introduction -- 4.2 A Stochastic Two-Country Flexible Exchange Rate Model -- 4.3 Solution of the Model and the Formation of Expectations -- 4.4 Full Current Information Solution -- 4.5 The Impact of Incomplete Current Information -- 4.6 Concluding Remarks -- V. RATIONAL EXPECTATIONS, PURCHASING POWER PARITY AND THE BUSINESS CYCLE -- 5.1 Introduction -- 5.2 A Decentralized Model of Trade and Production -- 5.3 Market-Clearing Determination of Price and Output in z -- 5.4 Market-Clearing in the Typical z* Market -- 5.5 A Centralized Market for Foreign Exchange -- 5.6 Rational Expectations