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
Heuristic vs formal dynamics of the wage- and price-curve model of equilibrium unemployment
Dag Kolsrud,Ragnar Nymoen +1 more
TL;DR: In this paper, the authors formalize this influential heuristic argument with the aid of a dynamic model of the wage-price spiral where the static theory's equations are reinterpreted as attractor relationships.
Posted ContentDOI
Macroeconomic policies and output fluctuations in slovakia: Application of the taylor rule
TL;DR: In this paper, the authors apply the Taylor rule to find that real output for Slovakia is positively influenced by real appreciation and world output, and negatively affected by the expected inflation rate, real government deficit, the euro interest rate, and the U.S. federal funds rate.
Book ChapterDOI
Empirical Test of the Balassa–Samuelson Effect in Selected African Countries
TL;DR: In this paper, the authors investigated the validity of the BS effect in selected African countries and found a positive relationship between real exchange rate and productivity, and recommended that countries should pursue policies that maintain competitive real exchange rates.
Journal ArticleDOI
Real Exchange Rate and Real Economic Fundamentals in Transition Economy of Bosnia and Herzegovina (BH)
TL;DR: In this article, the authors used co-integration methodology to observe relationship between Real Exchange Rate (RER) and selected economic fundamental variables over two different sample periods and found that RER is not a significant transmission mechanism for real economy towards achieving external balance as RER depreciation is not associated with an improvement in resource balance.
Posted Content
Modelling the heuristic dynamics of the wage and price curve model of equilibrium unemployment
Dag Kolsrud,Ragnar Nymoen +1 more
TL;DR: The authors formalize this influential heuristic argument with the aid of a dynamic model of the wage-price spiral where the static theory's equations are reinterpretated as attractor relationships.
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.