Journal ArticleDOI
Equilibrium real exchange rates
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In this article, the role of the real exchange rate in macroeconomic equilibrium is analyzed and the stabilizing role of monetary policy in adjustment towards the supply-side equilibrium exchange rate is analyzed both before and after entry to the exchange rate mechanism of the European Monetar System.Abstract:
This paper analyzes the role of the real exchange rate in macroeconomic equilibrium. The supply-side equilibrium exchange rate, that level of the real exchange rate at which (relative) inflation is constant, is derived from a simple macro-model and related to the standard "NAIRU" model. The stabilizing role of monetary policy in adjustment towards the supply-side equilibrium exchange rate is analyzed both before and after entry to the exchange rate mechanism of the European Monetar System. Resolution of the conflict between supply-side and external equilibrium produces a stricter definition of the fundamental equilibrium exchange rate of J. Williamson. Copyright 1992 by Blackwell Publishers Ltd and The Victoria University of Manchesterread more
Citations
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Journal ArticleDOI
Testing Steady-State Implications for the NAIRU
Gunnar Bårdsen,Ragnar Nymoen +1 more
TL;DR: In this paper, the correspondence between the operational NAIRU concepts and the steady state of a dynamic wage-price model is investigated, and a set of necessary conditions can be tested from estimated wage curves alone.
Journal ArticleDOI
Le taux de change réel d'équilibre : une introduction
TL;DR: In this article, the authors present the deux principales theories du taux de change reel d'equilibre, i.e., le prix relatif des biens echangeables par rapport aux biens non-echangeables.
Real exchange rate misalignment and economic growth in Nigeria
Abdulkadir I. Ali,Isaiah O. Ajibola,Babatunde S. Omotosho,Olutope O. Adetoba,Abiola O. Adeleke +4 more
TL;DR: In this article, the authors investigated the impact of Naira real exchange rate misalignment on Nigeria's economic growth using quarterly data spanning the period 2000-2014 and derived estimates of Real Exchange Rate Misalignment (RERMIS) by computing deviations from a sustainable equilibrium path that is determined using the Behavioural Equilibrium Exchange Rate (BEER) approach.
Journal ArticleDOI
On Designing an International Monetary System
TL;DR: This paper argued that a Keynesian policy assignment of demand management to continuous internal balance and the exchange rate to medium-run external balance was implicit in the Bretton Woods system, which had the advantages of avoiding a waste of resources on unnecessary unemployment, of preventing the competitive use of exchange-rate policy, and of desynchronizing the business cycle internationally, while building in an early warning signal of emerging inflationary pressures and providing an automatic stabilizer that would limit the damage caused by excess demand (in terms of a buildup of inflationary momentum) until needed deflationary measures could become effective
Journal ArticleDOI
Inevitable Disappointment? The ERM as the framework for UK monetary policy 1990–92
TL;DR: The UK left the ERM in September 1992 after the failure of a high-risk strategy resulting from the authorities' refusal to accept the constraints imposed by the EMs in that period.
References
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Journal ArticleDOI
The Causes of British Unemployment
Richard Layard,Stephen Nickell +1 more
TL;DR: Unemployment in Britain has risen from around 2 per cent in the late 1950s and early 1960s to around 3 per cent today as mentioned in this paper. But what accounts for this astonishing increase?
Journal ArticleDOI
Econometric Evaluation of the Exchange Rate in Models of the UK Economy
TL;DR: The authors evaluate the exchange rate mechanisms embodied in current large-scale models of the UK economy, and develop a new specification that is econometrically preferable to the existing models.
Book ChapterDOI
Inflation and the uk labour market
TL;DR: In this paper, the authors look at the problem of inflation both in general terms and in the British context, and consider inflation from a particular point of view, namely that of the labour market, although it would perhaps be more apt to describe the viewpoint as the supply side.
Journal ArticleDOI
The Role of the Real Exchange Rate and Capacity Utilisation in Convergence to the Nairu
Michael Joyce,Simon Wren-Lewis +1 more
TL;DR: This article examined three aspects of the NAIRU in the United Kingdom, all of which have been comparatively neglected in the literature, including the speed at which the NIRU is approached, where demand shocks persist because of contracts or adjustment costs, and the dynamic interrelationship between unemployment and utilisation in the goods market.
Journal ArticleDOI
Evaluating the u.k.‘s choice of entry rate into the erm
TL;DR: In this article, the authors argue that entry must be consistent with the economy's fundamental equilibrium exchange rate, but that governments can influence the speed of convergence to the fundamental equilibria.