During the financial crisis of 2008, the currencies of Latin America faced pressure to devalue— which evoked memories of the “contagious†crises of the 1990s. Yet even between crises, domestic macroeconomic factors can have an impact on a country's exchange market. This study...

This paper investigates contagion effects. In a model with highly and lowly informed investors we show that a currency crisis in one country can trigger a crisis in another country. Portfolio losses of the highly informed investors in one country will force them to withdraw capital from the...

This paper investigates contagion effects. In a model with highly and lowly informed investors we show that a currency crisis in one country can trigger a crisis in another country. Portfolio losses of the highly informed investors in one country will force them to withdraw capital from the...

This paper studies the effect on monetary policy of a non-homogeneous degree of competition across the (two) members of a monetary union. In particular, we assess the welfare loss brought about by the use of a simple interest rate rule that does not take into account such structural differences....

In December 1999 the Swiss National Bank (SNB) abandoned monetary targeting and introduced a new monetary policy strategy. The cornerstones of the new framework are an explicit definition of what the SNB considers to be price stability, a forecast of inflation over a three-year horizon, and a...

This paper evaluates under which conditions different Taylor-type rules lead to determinacy and expectational stability (E-stability) of rational expectations equilibrium in a simple 'New Keynesian' small open economy model, developed by Gali and Monacelli (2005). In particular, we extend the...

A small-scale open economy dynamic stochastic general equilibrium (DSGE) model is used to examine Philippine monetary policy. The model's parameters are estimated using Bayesian methods. Posterior odds tests are conducted to compare models with different specifications of the policy rule. These...

A small-scale open economy dynamic stochastic general equilibrium (DSGE) model is used to examine Philippine monetary policy. The model's parameters are estimated using Bayesian methods. Posterior odds tests are conducted to compare models with different specifications of the policy rule. These...