Open Economy Keynesian Macroeconomics Without the LM Curve

16 Pages Posted: 31 Mar 2013

See all articles by Oscar Bajo‐Rubio

Oscar Bajo‐Rubio

University of Castilla-La Mancha

Carmen Díaz‐Roldán

University of Castilla-La Mancha

Date Written: February 1, 2013

Abstract

In this paper, we present a novel framework for macroeconomic analysis, which tries to incorporate recent theoretical developments into a model describing an open economy. The model includes a monetary policy rule instead of the LM function together with an aggregate supply function derived from the Phillips curve, and is later extended to describe the case of a monetary union. This new approach should be useful for teaching purposes.

Keywords: Macroeconomics, monetary rule, open economy, monetary union

JEL Classification: A22, A23, E12, F41

Suggested Citation

Bajo-Rubio, Oscar and Diaz-Roldan, Carmen, Open Economy Keynesian Macroeconomics Without the LM Curve (February 1, 2013). Available at SSRN: https://ssrn.com/abstract=2241850 or http://dx.doi.org/10.2139/ssrn.2241850

Oscar Bajo-Rubio (Contact Author)

University of Castilla-La Mancha ( email )

Facultad de Derecho y Ciencias Sociales
Ronda de Toledo, s/n
Ciudad Real, E-13071
Spain
+34 926 295300 (Phone)
+34 926 295211 (Fax)

HOME PAGE: http://blog.uclm.es/oscarbajorubio/

Carmen Diaz-Roldan

University of Castilla-La Mancha ( email )

Facultad de Derecho y CC Sociales
Ciudad Real, Ciudad Real 13071
Spain

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