Liaw, Peir-Shyan; Cheng, Ming-Fang - In: Journal of Economics and Management 2 (2006) 2, pp. 147-186
This paper extends the theoretical model of Liaw et al. (2004) to incorporate the supply shocks of output. For a country adopting dual floating exchange rate system and facing the supply shocks will cause the price level to increase persistently. If the price level reaches the price ceiling...