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Alternative Financial Policy Rules in an Open Economy Under Rational and Adaptive Expectations
Blackburn, Keith; Currie, David; Whittaker, R; … - C.E.P.R. Discussion Papers - 1985
The potential instability of a fixed monetary rule combined with automatic fixed stabilisers is a well-established feature of closed economy IS/LM models with wealth effects and asset accumulation. This paper examines the stability issue in a general open economy macromodel with alternative...
Persistent link: https://www.econbiz.de/10005281316
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The Advantages of Tying One's Hands: EMS Discipline and Central Bank Credibility
Giavazzi, Francesco; Pagano, Marco - C.E.P.R. Discussion Papers - 1986
It is often argued that the EMS is an effective disciplinary device for inflation-prone countries in the EEC, since it …-makers in high-inflation countries: the reason is that not only it attaches an extra penalty to inflation (in terms of … inflationary finance, we find that they will always prefer EMS membership. When the policy-maker needs revenue from the inflation …
Persistent link: https://www.econbiz.de/10005791653
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Institutional Causes, Macroeconomic Symptoms: Volatility, Crises and Growth
Acemoglu, Daron; Johnson, Simon; Robinson, James A; … - C.E.P.R. Discussion Papers - 2002
Countries that have pursued distortionary macroeconomic policies, including high inflation, large budget deficits and …
Persistent link: https://www.econbiz.de/10005136626
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Monetary Integration in Europe: Implications for Real Interest Rates, National Stock Markets and the Volatility of Prices and Exchange Rates
Canzoneri, Matthew B; Dellas, Harris - C.E.P.R. Discussion Papers - 1995
therefore their stability. Transaction patterns also determine the correlation between prices and consumption, which in turn …
Persistent link: https://www.econbiz.de/10005662228
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Exchange Rates, Innovations and Forecasting
Wolff, Christian C - C.E.P.R. Discussion Papers - 1987
In this paper an ex-post forecasting experiment is performed on the basis of a version of the "news" model of exchange rate determination. A general finding is that the "news" formulation of monetary exchange rate models leads to relatively accurate ex post exchange rate forecasts. Often the...
Persistent link: https://www.econbiz.de/10005792277
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Robustness of Adaptive Expectations as an Equilibrium Selection Device
Lettau, Martin; Van Zandt, Timothy - C.E.P.R. Discussion Papers - 2001
Dynamic models in which agents' behaviour depends on expectations of future prices or other endogenous variables can have steady states that are stationary equilibria for a wide variety of expectations rules, including rational expectations. When there are multiple steady states, stability is a...
Persistent link: https://www.econbiz.de/10005791468
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Counter-Inflationary Policy in the Framework of the EMS
Artis, Michael J - C.E.P.R. Discussion Papers - 1992
narrowed ahead of inflation divergence. Cross-country real interest rankings would then assume a negative correlation with the … corresponding inflation rankings. The paper argues that on theoretical grounds, a perverse correlation between real interest rates … and inflation can be predicted for `old EMS' conditions. Empirical evidence supports this prediction while failing to …
Persistent link: https://www.econbiz.de/10005662333
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Charts, Noise and Fundamentals: A Study of the London Foreign Exchange Market
Taylor, Mark P - C.E.P.R. Discussion Papers - 1989
Recent research in financial economics has concentrated on the role of non-economic, or non-fundamentalist, speculators in asset markets. This paper presents some empirical evidence concerning the nature and perceived importance of a major form of non-fundamentalist analysis, chartism, in the...
Persistent link: https://www.econbiz.de/10005281398
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The Foreign Exchange Risk Premium in a Target Zone with Devaluation Risk
Svensson, Lars E O - C.E.P.R. Discussion Papers - 1991
The foreign exchange risk premium in an exchange rate target-zone regime with devaluation/realignment risks is derived. In contrast to previous literature, the exchange rate's heteroscedasticity within the band, as well as a separate devaluation/realignment risk, is taken into account. The risk...
Persistent link: https://www.econbiz.de/10005788869
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Fiscal Stimulus with spending reversals
Corsetti, Giancarlo; Meier, André; Müller, Gernot - C.E.P.R. Discussion Papers - 2009
The impact of fiscal stimulus depends not only on short-term tax and spending policies, but also on expectations about offsetting measures in the future. This paper analyzes the effects of an increase in government spending under a plausible debt-stabilizing policy that systematically reduces...
Persistent link: https://www.econbiz.de/10004976796