The Exchange Rate in a Dynamic-Optimizing Current Account Model with Nominal Rigidities : A Quantitative Investigation »
Series: IMF Working Papers
Author(s): Robert Kollman
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 January 1997
Keywords: exchange rate, money supply, exchange rates, real exchange rates, effective exchange rates, IMF Working Paper,
This paper studies dynamic-optimizing model of a semi-small open economy with sticky nominal prices and wages. The model exhibits exchange rate overshooting in response to money supply shocks. The predicted variabi...