Economists and financial commentators often refer to the exchange rate when theydiscuss the economic situation. However, for each currency there are as many exchangerates as there are other currencies and it is difficult to judge which if any should beconsidered the most important. In this...

Most products go through a life-cycle with certain common features across a wide rangeof different industries. In the early stages a new product has relatively few outlets and isoften viewed as a luxury item by consumers. Sales are therefore low and prices are highwhen it first appears on the...

Inflation has always been a key policy concern for governments. It is generally agreedthat a persistently rising price level causes disruption to the smooth operation of theeconomy and reduces the efficiency of the price mechanism. Moreover bringing downinflation is costly in that it can result...

This paper uses Monte Carlo methods to investigate the effects of asymmetric adjustment on estimates of the parameters of the equilibrium relationship between a set of variables.We demonstrate that simple least squares estimates and the implicit estimates from a symmetric error correction model...

Critical values for a test for cointegration are generated based on the joint significance of the levels terms in an error-correction equation. It is shown that the appropriate critical values are higher than those derived from the standard F-distribution. The power properties of this test are...

This article estimates limited dependent variable models for Bank of England monetary policy using monthly data over the period June 1997–March 2003. During this period the Bank had operational independence to set the interest rate in order to meet the inflation target set by the government....

In this paper we embed the Taylor interest rate rule in a simple macroeconomic model with Calvo contracts. We contrast this with the case in which the interest rate is determined by the conventional LM curve along with a fixed value for the monetary aggregate. We derive conditions under which...

The adoption of inflation targets by a number of industrialised countries in the last decade has reawakened interest in the study of rules to characterise monetary policy. In the literature a clear distinction is drawn between instrument rules, such as that of Taylor, which are backward looking,...

This paper sets out a version of the Taylor-Romer model of short-run macroeconomic equilibrium which can be used for teaching undergraduate economics principles courses. The aim is to generate a model with the proven advantages of the IS-LM framework but with a more realistic description of...

Chow and Lin (1971) set out a procedure for the generation of higher frequency estimates for series for which data is available at a low frequency using data on a related series at the higher frequency. In this paper we set out a simple algorithm for the generation of quarterly estimates for a...