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A Welfare Analysis of 'New Mercantilist' Foreign Reserve Accumulation
Rabe, Collin - 2016
Contrary to traditional neoclassical growth models, recent decades have seen a number of developing economies running sizable current account surpluses. In response to "new mercantilist" explanations of this phenomenon that relate holdings of foreign assets to higher levels of economic growth,...
Persistent link: https://www.econbiz.de/10012991447
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Computers, Obsolescence, and Productivity
Whelan, Karl - 2015
This paper examines the role that computers have played in boosting U.S. economic growth in recent years. The paper focuses on two effects - the effect of increased productivity in the computer-producing sector and the effect of investments in computing equipment on the productivity of those who...
Persistent link: https://www.econbiz.de/10014161771
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Real Exchange Rate Overshooting in Large Depreciations : Determinants and Consequences
Culiuc, Alexander - 2020
. The paper hypothesizes that the overshooting phase-observed early in the depreciation episode and driven by the balance … depreciation. Given this, larger real exchange rate overshooting should signal a relatively stronger balance sheet effect … external debt, low reserves, low trade openness), (ii) overshooting-based measures of the balance sheet effect foreshadow post-depreciation …
Persistent link: https://www.econbiz.de/10012831605
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International credit flows and pecuniary externalities
Brunnermeier, Markus Konrad; Sannikov, Yuliy - 2015
This paper develops a dynamic two-country neoclassical stochastic growth model with incomplete markets. Short-term credit flows can be excessive and reverse suddenly. The equilibrium outcome is constrained inefficient due to pecuniary externalities. First, an undercapitalized country borrows too...
Persistent link: https://www.econbiz.de/10010474855
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A Model of the Twin Ds : Optimal Default and Devaluation
Na, Seunghoon - 2015
This paper characterizes jointly optimal default and exchange-rate policy in a small open economy with limited enforcement of debt contracts and downward nominal wage rigidity. Under optimal policy, default occurs during contractions and is accompanied by large devaluations. The latter inflate...
Persistent link: https://www.econbiz.de/10013024385
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International Credit Flows and Pecuniary Externalities
Brunnermeier, Markus K. - 2015
This paper develops a dynamic two-country neoclassical stochastic growth model with incomplete markets. Short-term credit flows can be excessive and reverse suddenly. The equilibrium outcome is constrained inefficient due to pecuniary externalities. First, an undercapitalized country borrows too...
Persistent link: https://www.econbiz.de/10013028913
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The Influence of Capital Controls on Long Run Growth : Where and How Much?
Chanda, Areendam - 2019
The recent financial crisis in East Asia has generated a revival of interest in the merits of financial openness. The ensuing debate on the benefits of openness has focused more on short and medium run issues than on the long run effects. Within the empirical literature on economic growth,...
Persistent link: https://www.econbiz.de/10014130504
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The possible trinity : optimal interest rate, exchange rate, and taxes on capital flows in a DSGE model for a small open economy
Escudé, Guillermo J. - 2014
A traditional way of thinking about the exchange rate regime and capital account openness has been framed in terms of the 'impossible trinity' or 'trilemma', according to which policymakers can only have two of three possible outcomes: open capital markets, monetary independence and pegged...
Persistent link: https://www.econbiz.de/10010337474
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The possible trinity : optimal interest rate, exchange rate, and taxes on capital flows in a DSGE model for a small open economy
Escudé, Guillermo J. - 2014
A traditional way of thinking about the exchange rate (XR) regime and capital account openness has been framed in terms of the 'impossible trinity' or 'trilemma', in which policymakers can only have 2 of 3 possible outcomes: open capital markets, monetary independence and pegged XRs. This paper...
Persistent link: https://www.econbiz.de/10010370928
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Recent advances in the literature on capital flow management
Beck, Roland; Berganza, Juan Carlos; Brüggemann, Axel; … - 2023 - Revised September 2023
Large swings in cross-border capital flows can have consequences for domestic stability and open a channel for the transmission of shocks and spillovers across economies, including the euro area. Against this backdrop, the present paper reviews new evidence for the effectiveness of capital flow...
Persistent link: https://www.econbiz.de/10014517643