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An Exploration of the International Comparison Program's New Global Economic Landscape

Ravallion, Martin - 2014

inflation rates account for a share of the PPP changes, although less so for the 2011 revisions than prior ICP rounds. A marked …

Persistent link: https://www.econbiz.de/10013050153

Fixed Exchange Rates, Inflation and Macroeconomic Discipline

Edwards, Sebastian; Losada, Fernando J. - 2021

inflation rate differentials between those countries and the United States. We found that the fixed parities regime worked … exchange rate system was not sufficient to avoid inflation outbursts and balance of payments crises. Specifically, it was …

Persistent link: https://www.econbiz.de/10013211655

Expenditure Switching vs. Real Exchange Rate Stabilization : Competing Objectives for Exchange Rate Policy

Devereux, Michael B. - 2009

This paper develops a view of exchange rate policy as a trade-off between the desire to smooth fluctuations in real exchange rates so as to reduce distortions in consumption allocations, and the need to allow flexibility in the nominal exchange rate so as to facilitate terms of trade adjustment....

Persistent link: https://www.econbiz.de/10012767336

Explaining the Effects of Government Spending Shocks on Consumption and the Real Exchange Rate

Ravn, Morten O. - 2007

Using panel structural VAR analysis and quarterly data from four industrialized countries, we document that an increase in government purchases leads to an expansion in output and private consumption, a deterioration in the trade balance, and a depreciation of the real exchange rate (i.e., a...

Persistent link: https://www.econbiz.de/10012776197

Tariffs, the Real Exchange Rate and the Terms of Trade : on Two Popular Propositions in International Economics

Wijnbergen, Sweder van - 2007

In this paper we investigate the relation between tariff changes, terms of trade changes and the equilibrium real exchange rate. For this purpose we use two models of a small open economy: (1) a three goods version of the Ricardo-Viner model; and (2) a three goods model with full intersectoral...

Persistent link: https://www.econbiz.de/10012777259

Commodity Export Prices and the Real Exchange Rate in Developing Countries : Coffee in Colombia

Edwards, Sebastian - 2007

, inflation, and the real exchange rate in a developing country is developed. The model is then tested using data for Colombia. A … inflation. The results obtained indicate that coffee price changes have indeed been closely related to money creation and … inflation. Also, coffee price changes have been negatively related to the rate of devaluation of the crawling peg. These results …

Persistent link: https://www.econbiz.de/10012777342

Exchange Rate Disconnect in General Equilibrium

Itskhoki, Oleg - 2020

We propose a dynamic general equilibrium model of exchange rate determination, which simultaneously accounts for all major puzzles associated with nominal and real exchange rates. This includes the Meese-Rogoff disconnect puzzle, the PPP puzzle, the terms-of-trade puzzle, the Backus- Smith...

Persistent link: https://www.econbiz.de/10012854302

Obstfeld and Rogoff's International Macro Puzzles : A Quantitative Assessment

Eaton, Jonathan - 2015

Obstfeld and Rogoff (2001) propose that trade frictions lie behind key puzzles in international macroeconomics. We take a dynamic multicountry model of international trade, production, and investment to data from 19 countries to assess this proposition quantitatively. Using the framework...

Persistent link: https://www.econbiz.de/10013010717

Monetary Policy and the Predictability of Nominal Exchange Rates

Eichenbaum, Martin S. - 2017

inflation rates in shaping the response of real exchange rates to shocks. We document two facts about inflation … rate is a poor predictor of future inflation rates. We estimate a medium-size DSGE open-economy model that accounts … that accounts for the dynamics of exchange rates and their covariance with inflation are disturbances to the foreign demand …

Persistent link: https://www.econbiz.de/10012963169

Demand for Value Added and Value-Added Exchange Rates

Bems, Rudolfs - 2015

We examine the role of cross-border input linkages in governing how international relative price changes influence demand for domestic value added. We define a novel value-added real effective exchange rate (REER), which aggregates bilateral value-added price changes, and link this REER to...

Persistent link: https://www.econbiz.de/10013024860