Macroeconomic Stability: Transition Towards the Nominal Exchange Rate Stability

CERGE-EI Working Paper Series No. 368

53 Pages Posted: 7 Oct 2009

See all articles by František Brázdik

František Brázdik

Czech National Bank; Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute)

Juraj Antal

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute)

Date Written: October 1, 2008

Abstract

The novelty of this work is in the presentation of a theoretical framework that allows the modeling of an announced switch of the monetary regime. In our experiment, the monetary authority announces stabilization of the nominal exchange rate after the announced number of periods. We analyze the effects of the monetary policy regime for the macroeconomic stability over the transition period. For our analysis, we consider representative forms of standard monetary regimes. Moreover, we rank the examined regimes in terms of loss functions.

Keywords: New Keynesian Models, Small Open Economy, Monetary regime switch

JEL Classification: E17, E31, E52, E58, E61, F02, F41

Suggested Citation

Brázdik, František and Antal, Juraj, Macroeconomic Stability: Transition Towards the Nominal Exchange Rate Stability (October 1, 2008). CERGE-EI Working Paper Series No. 368. Available at SSRN: https://ssrn.com/abstract=1483776 or http://dx.doi.org/10.2139/ssrn.1483776

František Brázdik (Contact Author)

Czech National Bank ( email )

Na Prikope 28
CZ-11503 Praha 1
Czech Republic

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute) ( email )

P.O. Box 882
7 Politickych veznu
Prague 1, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

Juraj Antal

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute) ( email )

P.O. Box 882
7 Politickych veznu
Prague 1, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

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