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Net worth, exchange rates, and monetary policy : the effects of a devaluation in a financially fragile environment

Delli Gatti, Domenico; Gallegati, Mauro; Greenwald, … - 2007

In this paper we propose an Open Economy Financial Accelerator model along the lines of Greenwald-Stiglitz (1993) close in spirit but different in many respects from the one proposed by Greenwald (1998.) The first goal of the paper is to provide a taxonomy of the effects of a devaluation in this...