Analyses of the political economy of exchange-rate policy posit that firms and individuals in different sectors of the economy have distinct policy attitudes toward the level and the stability of the exchange rate. Most such approaches hypothesize that internationally exposed firms prefer more...

Daily French and German interest rate changes since the Basle-Nyborg agreement of September 1987 are examined empirically. In particular, it is asked whether the shock associated with German unification altered the degree of leadership of German monetary policy in the exchange rate mechanism...

This paper models alternative policy responses to various sorts of disturbances-or "shocks"-to the steady-state path of a developing economy. Its objective is to arrive at some generalizations about appropriate credit and exchange rate policies. (One result, for example, focuses on the folly of...

In this paper we analyze how the mutual interdependence of private sector expectations influences the stability offixed exchange rate regimes in different countries. When countries trade with one another, the crisis probabilities are interdependent because monetary policy in each country affects...

This paper uses vector autoregressions to examine the monetary transmission mechanism in Japan. The empirical results indicate that both monetary policy and bank's balance sheets are important sources of shocks, that banks play a crucial role in transmitting monetary shocks to economic activity,...

This paper uses vector autoregressions to examine the monetary transmission mechanism in Japan. The empirical results indicate that both monetary policy and banksí balance sheets are important sources of shocks, that banks play a crucial role in transmitting monetary shocks to economic...

The observation that inflation reduces real revenues when there are lags in tax collection has long been a strong argument against seigniorage. However, with the exception of Dixit, who used a general equilibrium model to reject this argument, the optimal taxation literature has not analyzed how...

This paper reviews Romania's experience with interenterprise arrears during 1991 with the purpose of extracting lessons that might prove useful for other economies in transition to market-based systems. The rapid growth of interenterprise arrears poses a serious policy problem in many of the...

This paper examines the effects of a repatriation of foreign assets in an economy subject to currency substitution. In the absence of 100 percent reserve requirements, a change in the location of deposits that is not compensated by an increase in money demand induces a credit boom that works...

When there are collection lags in the tax system, inflation reduces real revenues. This is often offered as an argument for less reliance on the inflation tax. But the optimal rates of other taxes should also be reconsidered in the light of collection lags. When this is done, the focus shifts...