The early stages of transformation of centrally planned economies into market economies are examined. In the transitional phase when an economy is no longer centrally planned, but not yet market based--when it is a "previously centrally planned economy"--expectations play a key role. A model is...

Traditional analyses of budget deficits arising from tax cuts have focused on the size of the deficit and disregarded the underlying tax system. This paper examines the international effects of budget deficits under alternative tax systems. The key finding is that the consequences of tax...

Macroeconomic issues pertinent to the international and domestic effects of international VAT harmonization are highlighted, and VAT harmonization policies envisaged for Europe in 1992 are outlined. An intertemporal model is developed to analyze the incentive effects of various tax policies and...

This article documents and contrasts the degree of interdependence of key macroeconomic variables across six major industrial economies (the United States, Canada, Japan, France, the Federal Republic of Germany, and the United Kingdom) over the periods 1960-71 and 1974-82. Principal components...

This paper analyzes the determinants of the evolution of exchange rates within the context of alternative models of exchange rate dynamics. The overshooting hypothesis is examined in models that emphasize differential speeds of adjustment in asset and goods markets as well as in models that...

This paper identifies key issues surrounding the advisability and practicality of adopting "target zones" for the exchange rates of major currencies. Four fundamental questions concerning the definition of and the rationale for target zones are addressed: first, what is generally meant by a...

Key issues relating to the design and implementation of monetary policy in an emerging European economic and monetary union are discussed, although specific institutional proposals for transition to EMU are neither endorsed nor dismissed. The goals of monetary policy are examined in the context...

The Mundell-Fleming model of international macroeconomics originated in the early 1960s and has been extended during the ensuing quarter century. This paper develops an exposition that integrates the various facets of the model and incorporates its extensions into a unified analytical framework....