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How do Capital Controls Affect the Transmission of Foreign Shocks?
Cooke, Dudley - 2007
This paper studies the short-run transmission of foreign shocks in a small open economy with capital controls and a fixed exchange rate. Capital controls alter the transmission of shocks because endogenous changes in the domestic nominal interest rate affect savings and investment decisions. The...
Persistent link: https://www.econbiz.de/10010320958
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Monetary policy shocks in a two-sector open economy: an empirical study
Llaudes, Ricardo - 2007
This paper studies the effects and the transmission mechanism of unexpected monetary policy shocks in an open economy setting within the context of a VAR frame- work. It considers an economy with two sectors, a tradable sector and a non-tradable sector. For a given country, economic sectors are...
Persistent link: https://www.econbiz.de/10011604845
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Openness, Specialisation and Vulnerability of the Nordic Countries
Kaitila, Ville; Virkola, Tuomo - 2014
In this paper we analyse to what extent the Nordic economies are vulnerable to external shocks. Specifically, we assess the conventional wisdom that the Nordic countries are small open economies that are significantly engaged in international trade, specialised in only few specific industries...
Persistent link: https://www.econbiz.de/10012037641
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Interest premium and economic growth: the case of CEE
Baksa, Dániel; Kónya, István - 2017
This paper views the growth and convergence process of the four Visegrad economies - the Czech Republic, Hungary, Poland and Slovakia - through the lens of the open economy, stochastic neoclassical growth model. We use a unified framework to understand both the long-run convergence path and...
Persistent link: https://www.econbiz.de/10011944909
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Monetary Policy in a Small Open Economy Model: A DSGE-VAR Approach for Switzerland
Bäurle, Gregor; Menz, Tobias - 2008
We study the transmission of monetary shocks and monetary policy with a behavioral model, corrected for potential misspecification using the DSGE-VAR framework elaborated by DelNegro and Schorfheide (2004). In particular, we investigate if the central bank should react to movements in the...
Persistent link: https://www.econbiz.de/10011430077
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A double-edged sword: High interest rates in capital-control regimes
2009
Persistent link: https://www.econbiz.de/10014306479
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Rethinking the Economics of Capital Mobilityand Capital Controls
Palley, Thomas I. - 2009
This paper reexamines the issue of international financial capital mobility, which is today's economic orthodoxy. Discussion is often framed in terms of the impossible trinity. That framing distorts discussion by representing capital mobility as having equal significance with sovereign monetary...
Persistent link: https://www.econbiz.de/10010460473
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A DSGE model for a SOE with systematic interest and foreign exchange policies in wich policymakers exploit the risk premium for stabilization purposes
Escudé, Guillermo - 2013
This paper builds a DSGE model for a SOE in which the central bank systematically intervenes both the domestic currency bond and the FX markets using two policy rules: a Taylor-type rule and a second rule in which the operational target is the rate of nominal currency depreciation. For this, the...
Persistent link: https://www.econbiz.de/10010325096
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A DSGE model for a SOE with systematic interest and foreign exchange policies in which policymakers exploit the risk premium for stabilization purposes
Escudé, Guillermo J. - In: Economics: The Open-Access, Open-Assessment E-Journal 7 (2013) 2013-30, pp. 1-110
This paper builds a DSGE model for a small open economy (SOE) in which the central bank intervenes the domestic currency bond and FX markets using two policy rules: a Taylor-type rule and a rule that determines the rate of nominal depreciation. The 2 'corner' regimes, in which only one policy...
Persistent link: https://www.econbiz.de/10010317972
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Introducing financial frictions and unemployment into a small open economy model
Christiano, Lawrence J.; Trabandt, Mathias; Walentin, Karl - 2007
the model using Bayesian techniques on Swedish data. Our main results are: i) A financial shock to entrepreneurial wealth … and GDP. ii) The marginal efficiency of investment shock has very limited importance when we match financial market data …. iii) Our model does not need any high frequency wage markup shocks to match the data. Furthermore, the labor supply shock …
Persistent link: https://www.econbiz.de/10010320738