This paper considers the general equilibrium relationship between exchange rates and global imbalances. It emphasizes that the exchange rate is not a primitive but an equilibrium price determined by the policy mix. It uses extensions of the two-country Obstfeld-Rogoff model to analyze the...

This paper considers the general equilibrium relationship between exchange rates and global imbalances. It emphasizes that the exchange rate is not a primitive but an equilibrium price determined by the policy mix. It uses extensions of the two-country Obstfeld-Rogoff model to analyze the...

The real trade weighted value of the dollar fell 11 percent against the Federal Reserve Bank's index of major currencies during the 12 months through May 2011 and 31 percent during the past ten years. Four strong market forces are likely to cause further declines over the next several years: a...

This paper provides an overview of the evolution of macroeconomic thought from 1936, the year John Maynard Keynes published his general theory of employment, interest and money to the year 2010. It explores the reasons for the extension of the business cycle during the postwar period. The paper...

Orthodox and heterodox theories of financial crises are hereby compared from a theoretical viewpoint, with emphasis on their genesis. The former view (represented by the fourth-generation models of Paul Krugman) reflects the neoclassical vision whereby turbulence is an exception; the latter...

We review the modern history of financial crises, providing a context for analyses of the world's recent bout of financial instability. Along with indicators of economic performance in the subject countries, we present a comprehensive description of multilateral rescue efforts spanning the last...

Payne and Kumazawa (2005) examine the effect of domestic savings, foreign aid, the evolution of capital mobility over time, and openness on investment rates using a panel of sub-Saharan African countries. They find that capital mobility has increased over time and that foreign aid and openness...

With recent studies generating skepticism toward aid-effectiveness for economic growth of some aid-dependent economies, the need to re-examine the effectiveness of foreign aid for economic growth has gained increasing importance. This paper examines the role of foreign aid in per-capita economic...

Purpose – The purpose of this paper is to examine empirical characteristics of two commonly mentioned expressions of international financial crisis, “sudden stops” and currency crises. Design/methodology/approach – Sudden stop and currency crisis events are identified and empirical...

This study seeks to empirically analysis the joint impact of trade liberalization and financial development on economic growth in Iran, using endogenous growth theory during the period 1966-2010. In this article principal component analysis is applied to make better indexes for trade...