This paper addresses the issue of a coordinated adjustment plan (“new Plaza") to close global imbalances. We show that the complexity of the network of bilateral trade imbalances has increased, revealing that any plan focusing on industrialised countries only is likely to be ineffective. By...

Global imbalances are not new as much as the effort to address them. In the mid 1980s the phenomenon led the most industrialised countries to orchestrate a devaluation of the US dollar so as to reduce the US trade deficit. Some economists have called for a similar "New Plaza" agreement to tackle...

This paper analyzes the reaction of exporters to exchange rate changes. We present a model where, in the presence of distribution costs in the export market, high and low productivity firms react differently to a depreciation. Whereas high productivity firms optimally raise their markup rather...

This article provides an assessment of labour market adjustments occurring in Estonia during the global crisis. As part of the so-called internal devaluation, the strategy followed was very successful in shrinking the unit labour costs, thus helping Estonian enterprises to gain international...

It is argued that the successive regimes for restructuring sovereign debts, since the early 20th century have been shaped by the articulation of three institutional functions: information gathering and economic expertise, then third-party mediation, lastly policy enforcement, also called...

The alleged undervaluation of the renminbi has been the subject of intensive academic research over the past few years. Using equilibrium exchange rate models many authors have concluded that the renminbi is undervalued by 15 to 30% against the US dollar. Yet China has been experiencing strong...