A distinction can be made between two approaches to exchange rate policy in developing countries. The"real targets"and the"nominal anchor"approach. Part I of this report gives an overview of the two approaches and the assumptions they imply. Part II expounds the"real targets"approach and its...

This paper takes a close look at the Keynesian theory underlying the policy of fiscal stimulus being undertaken or considered in many countries, led by the United States. A central question is whether a debt-financed fiscal stimulus now must adversely affect future taxpayers, owing to the debt...

"The international current account imbalances, whereby the USA has a vast deficit and several countries, notably Japan, China, Germany and the oil exporters, have corresponding surpluses, are usually seen as problems. The argument here is that current account imbalances simply indicate...