The Simple Geometry of Transmission and Stabilization in Closed and Open Economies
Paolo A. Pesenti
Federal Reserve Bank of New York; National Bureau of Economic Research (NBER)
European University Institute - Robert Schuman Centre for Advanced Studies (RSCAS); University of Rome III - Department of Economics; Centre for Economic Policy Research (CEPR)
FRB of New York Research Paper No. 209
This paper provides an introduction to the recent literature on macroeconomic stabilization in closed and open economies. We present a stylized theoretical framework, illustrating its main properties with the help of an intuitive graphical apparatus. Among the issues we discuss are optimal monetary policy and the welfare gains from macroeconomic stabilization, the international transmission of real and monetary shocks and the role of exchange rate pass-through, and the design of optimal exchange rate regimes and monetary coordination among interdependent economies.
Number of Pages in PDF File: 75
Keywords: optimal monetary policy, nominal rigidities, exchange rate pass-through
JEL Classification: E31, E52, F42working papers series
Date posted: May 30, 2005
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo5 in 0.469 seconds