tailieunhanh - International Macroeconomics and Finance: Theory and Empirical Methods Phần 8

Cho thấy tỷ lệ không đúng tính toán trên các dữ liệu Lothian-Taylor cùng với tiêu chuẩn tiệm cận ước tính điểm hiển thị hình dạng của một "bướu". Họ ban đầu tăng trên 1 chân trời ngắn sau đó giảm xuống dưới 1 ở chân trời lâu hơn. | . VAR ANALYSIS OF MUNDELL-FLEMING 259 When this is multiplied out you get 0 91a p X X p. 0 nSa 91 n It follows that a Ị3 91X. Because a is proportional to p we need to impose a normalization. Let this normalization be p po p where po p 0 . Then a po p 9iX po p 9X where 9 91. Using these values of a and p in and yields p t p po p e et s t s so s e et where so s po p 9X. This solution gives the time paths for the price level and the exchange rate. To characterize the system and its response to monetary shocks we will want to phase diagram the system. Going back to and we see that s t 0 if and only if p t p while p t 0 if and only if s t s 1 Ơ X8 p t p . These points are plotted in Figure . The system displays a saddle path solution. 260 CHAPTER 8. THE MUNDELL-FLEMING MODEL Figure Phase diagram for the Dornbusch model. . VAR ANALYSIS OF MUNDELL-FLEMING 261 Problems 1. Static Mundell-Fleming with imperfect capital mobility . Let the trade balance be given by a s p p Uy. A real depreciation raises exports and raises the trade balance whereas an increase in income leads to higher imports which lowers the trade balance. Let the capital account be given by 0 i i where 0 0 TO indexes the degree of capital mobility. We replace with the external balance condition a s p p Uy 0 i i 0 that the balance of payments is 0. We are ignoring the service account. When capital is completely immobile 0 0 and the balance of payments reduces to the trade balance. Under perfect capital mobility 0 TO implies i i which is . a Call the external balance condition the FF curve. Draw the FF curve in r y space along with the LM and IS curves. b Repeat the comparative statics experiments covered in this chapter using the modified external balance condition. Are any of the results sensitive to the degree of capital mobility In particular how do the results depend on the slope of the FF curve in relation to the LM curve 2. How would .

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