Using a four-country Mundell-Fleming model including portfolio and wealth effects, we explore the question whether some types of policy coordination could improve the outcomes of a financial shock like the Asian crisis. Time-consistent equilibria are computed: a Nash equilibrium, a target zone...

Chapter 1: Introduction -- Chapter 2: Prologue -- Part 1: Internal and External Equilibrium under the Bretton Woods System -- Chapter 3: Japanese Economic Policy Management under the Bretton Woods System -- Chapter 4: The Internal vs External Dilemma: West German and Japanese Episodes -- Chapter...