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Explaining inflation with a classical dichotomy model and switching monetary regimes : Mexico 1932-2013

Garcés Díaz, Daniel G. - 2017

This paper applies a novel approach to study the impact of different shocks on the price level. It uses a classical dichotomy model with monetary policy regime shifts at known dates. First, there was a regime dominated by money, afterwards a regime driven by the exchange rate and a third one...

Persistent link: https://www.econbiz.de/10011759587

Information Frictions and Real Exchange Rate Dynamics

Candian, Giacomo - 2017

Real exchange rates are highly volatile and persistent. I provide a novel structural explanation for these facts using a model with dispersed information among firms. When producers face strategic complementarities in price-setting, uncertainty about competitors' beliefs results in sluggish...

Persistent link: https://www.econbiz.de/10012965709

The equilibrium rate of unemployment and the real exchange rate : an unobserved components system approach

Lindblad, Hans; Sellin, Peter - 2003

We set up and estimate a structural unobserved components open economy model for the rate of unemployment and the real exchange rate in Sweden. This approach enables us to simultaneously determine changes in both cyclical and equilibrium rates. Our results show that the Natural Rate/NAIRU has...

Persistent link: https://www.econbiz.de/10011583137

Addressing Econometric Issues on How to Construct Theoretical Based Exchange Rate Misalignment Estimates : Searching for a Comprehensive Approach

Marçal, Emerson Fernandes - 2017

Assessing real effective exchange rate equilibrium is a challenging task. There is no consensus in the literature on which methodologies and norms apply best to tackle real effective exchange rate misalignment estimation. The novelty of our paper consists of showing that different methodologies...

Persistent link: https://www.econbiz.de/10012972106

Allowing the Data to Speak Freely : The Macroeconometrics of the Cointegrated Vector Autoregression

Hoover, Kevin D. - 2008

An explication of the key ideas behind the Cointegrated Vector Autoregression Approach. The CVAR approach is related to Haavelmo's famous quot;Probability Approach in Econometricsquot; (1944). It insists on careful stochastic specification as a necessary groundwork for econometric inference and...

Persistent link: https://www.econbiz.de/10012726093

Escape Clauses and Targeting of the Real Exchange Rate : The Case of Nominal Exchange Rate Pegging

Gonzalez, Pablo - 2010

We consider an economy under a fixed exchange rate system, but with bounds (a minimum level or a band) on the real exchange rate. The international price of the tradable good is characterized by the continuous arrival of shocks that change its level. In a model with microfoundations, we...

Persistent link: https://www.econbiz.de/10013135111

Inflation and hyperinflation in Venezuela (1970s-2016) : a post-Keynesian interpretation

Kulesza, Marta - 2017

This paper aims to explain the causes of rapidly increasing prices in Venezuela and establish whether the current episode can be considered to be of hyperinflationary nature from the post-Keynesian theoretical approach. The chosen approach highlights the role of distributive conflict, indexation...

Persistent link: https://www.econbiz.de/10011747158

Purchasing Power Parity : A Unit Root, Cointegration and VAR Analysis in Emerging and Advanced Countries

Loukopoulos, Georgios - 2014

The purpose of this study is to investigate the validity of the absolute version of the purchasing power parity (PPP … of PPP we apply the Augmented Dickey-Fuller, DF-GLS and KPSS tests for non-stationarity, and the Johansen procedure for … 77,39 months. Overall, unit root tests show that absolute PPP may hold, but this depends on the country and the selected …

Persistent link: https://www.econbiz.de/10013044515

Economic Growth under Alternative Monetary Regimes : Inflation Targeting vs Real Exchange Rate Targeting

Cordero, José Antonio - 2008

A Post Keynesian model is developed to examine the main features and consequences of a monetary regime based on inflation targeting. The growth performance of this regime is compared to the one resulting from real exchange rate targets. Inflation targeting is shown to hurt growth and employment...

Persistent link: https://www.econbiz.de/10012726142

Monetary policy and exchange rates : a balanced two-country cointegrated VAR model approach

Heinlein, Reinhold; Krolzig, Hans-Martin - 2013

We study the exchange rate effects of monetary policy in a balanced macroeconometric two-country model for the US and UK. In contrast to the empirical literature on the "delayed overshooting puzzle", which consistently treats the domestic and foreign countries unequally in themodelling process,...

Persistent link: https://www.econbiz.de/10010228354

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