This paper analyzes the determinants of the evolution of exchange rates within the context of alternative models of exchange rate dynamics. The overshooting hypothesis is examined in models that emphasize differential speeds of adjustment in asset and goods markets as well as in models that...

This paper identifies key issues surrounding the advisability and practicality of adopting "target zones" for the exchange rates of major currencies. Four fundamental questions concerning the definition of and the rationale for target zones are addressed: first, what is generally meant by a...

Key issues relating to the design and implementation of monetary policy in an emerging European economic and monetary union are discussed, although specific institutional proposals for transition to EMU are neither endorsed nor dismissed. The goals of monetary policy are examined in the context...

The Mundell-Fleming model of international macroeconomics originated in the early 1960s and has been extended during the ensuing quarter century. This paper develops an exposition that integrates the various facets of the model and incorporates its extensions into a unified analytical framework....