Correlations Between Real Interest Rates and Output in a Dynamic International Model

Correlations Between Real Interest Rates and Output in a Dynamic International Model
Author: Ms.Jahanara Zaman
Publisher: International Monetary Fund
Total Pages: 44
Release: 1998-12-01
Genre: Business & Economics
ISBN: 1451859007

This paper examines the extent to which a dynamic international general equilibrium model can account for observed movements in real interest rates and interest rate differentials. Using data for Group of Seven, the study finds that measured real interest rates are countercyclical in a single country and that the contemporaneous cross-correlations between international real interest differentials and output growth spreads are negative. Predictions of the baseline model are, however, inconsistent with the data. Extending the benchmark model to include habit persistence in consumption improves the match between theory and data.

The Exchange Rate in a Dynamic-Optimizing Current Account Model with Nominal Rigidities

The Exchange Rate in a Dynamic-Optimizing Current Account Model with Nominal Rigidities
Author: Robert Miguel W. K. Kollman
Publisher: International Monetary Fund
Total Pages: 52
Release: 1997-01-01
Genre: Business & Economics
ISBN: 1451928521

This paper studies dynamic-optimizing model of a semi-small open economy with sticky nominal prices and wages. The model exhibits exchange rate overshooting in response to money supply shocks. The predicted variability of nominal and real exchange rates is roughly consistent with that of G-7 effective exchange rates during the post-Bretton Woods era. The model predicts that a positive domestic money supply shock lowers the domestic nominal interest rate, that it raises output and that it leads to a nominal and real depreciation of the country’s currency. Increases in domestic labor productivity and in the world interest rate too are predicted to induce a nominal and real exchange rate depreciation.

IMF Staff Papers, Volume 46, No. 1

IMF Staff Papers, Volume 46, No. 1
Author: International Monetary Fund. Research Dept.
Publisher: International Monetary Fund
Total Pages: 116
Release: 1999-03-15
Genre: Business & Economics
ISBN: 1451974558

This economic journal contains theoretical and empirical analyses of varous macroeconomic issues. The studies are prepapred by IMF research staff or consultants. Subjects covered inclulde balance of payments and exchange rates, monetary systems and policies, public finances, international trade, economic growth, and some sectoral analyses. The last issue of the year contains an index to the volume. Approximately 200 pages in each issue.

Explaining International Comovements of Output and Asset Returns

Explaining International Comovements of Output and Asset Returns
Author: Robert Miguel W. K. Kollman
Publisher: International Monetary Fund
Total Pages: 51
Release: 1999-06-01
Genre: Business & Economics
ISBN: 145185062X

Empirically, output and asset returns are highly positively correlated across the United States and the other major industrialized countries. Standard business cycle models that assume flexible prices and wages, in the Real Business Cycle tradition, have great difficulties explaining this fact. This paper presents a dynamic-optimizing stochastic general equilibrium model of a two-country world with sticky nominal prices and wages and a flexible exchange rate. The structure here predicts positive international transmission of country-specific monetary policy and technology shocks, and it generates sizable cross-country correlations of output and of asset returns.

The Oxford Handbook of the Economics of Central Banking

The Oxford Handbook of the Economics of Central Banking
Author: David G. Mayes
Publisher: Oxford University Press
Total Pages: 809
Release: 2019-02-15
Genre: Business & Economics
ISBN: 0190626216

The economic influence of central banks has received ever more attention given their centrality during the financial crises that led to the Great Recession, strains in the European Union, and the challenges to the Euro. The Oxford Handbook of the Economics of Central Banking reflects the state of the art in the theory and practice and covers a wide range of topics that will provide insight to students, scholars, and practitioners. As an up to date reference of the current and potential challenges faced by central banks in the conduct of monetary policy and in the search for the maintenance of financial system stability, this Oxford Handbook covers a wide range of essential issues. The first section provides insights into central bank governance, the differing degrees of central bank independence, and the internal dynamics of their decision making. The next section focuses on questions of whether central banks can ameliorate fiscal burdens, various strategies to affect monetary policy, and how the global financial crisis affected the relationship between the traditional focus on inflation targeting and unconventional policy instruments such as quantitative easing (QE), foreign exchange market interventions, negative interest rates, and forward guidance. The next two sections turn to central bank communications and management of expectations and then mechanisms of policy transmission. The fifth part explores the challenges of recent developments in the economy and debates about the roles central banks should play, focusing on micro- and macro-prudential arguments. The implications of recent developments for policy modeling are covered in the last section. The breadth and depth enhances understanding of the challenges and opportunities facing central banks.

IMF Staff papers, Volume 37 No. 3

IMF Staff papers, Volume 37 No. 3
Author: International Monetary Fund. Research Dept.
Publisher: International Monetary Fund
Total Pages: 292
Release: 1990-01-01
Genre: Business & Economics
ISBN: 1451973063

This paper analyzes macroeconomic effects of projected population aging in industrial countries. The effects of population aging are examined with a theoretical model and simulations of the IMF’s multiregion econometric model (MULTIMOD). The study highlights that an older population will consume more of aggregate disposable income, require higher government expenditure, and decrease labor supply. These effects should raise real interest rates and lower capital stock and output. Effects on current balances will depend on the relative speed and extent of aging.

Dynamic Analysis in Complex Economic Environments

Dynamic Analysis in Complex Economic Environments
Author: Herbert Dawid
Publisher: Springer Nature
Total Pages: 244
Release: 2020-12-22
Genre: Business & Economics
ISBN: 3030529703

This book analyses decision-making in dynamic economic environments. By applying a wide range of methodological approaches, combining both analytical and computational methods, the contributors examine various aspects of optimal firm behaviour and relevant policy areas. Topics covered include optimal control, dynamic games, economic decision-making, and applications in finance and economics, as well as policy implications in areas such as pollution regulation. This book is dedicated to Christophe Deissenberg, a well-known and distinguished scholar of economic dynamics and computational economics. It appeals to academics in the areas of optimal control, dynamic games and computational economics as well as to decision-makers working in policy domains such as environmental policy.