A Dynamic Disequilibrium Comparison of Fixed and Free Exchange-Rate Regimes.
This article constructs a disequilibrium model that traces out the long-run time path of different exchange-rate regimes. It assumes that the money wage adjusts slowly and transactions can occur at labor market disequilibrium. Unemployment generated from this type of economic behavior is typically i...
| Publicado en: | American Economic Review Vol. 69; no. 5; pp. 843 - 855 |
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| Formato: | Artículo |
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American Economic Association
Dec79
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=hlh&AN=4498158&site=ehost-live header: @attributes: shortDbName: hlh uiTerm: 4498158 longDbName: Humanities International Complete uiTag: AN controlInfo: bkinfo: jinfo: jid: 00028282 AER jtl: American Economic Review issn: 00028282 maglogo: N pubinfo: dt: Dec79 vid: 69 iid: 5 pid: 22 pub: American Economic Association artinfo: ui: 4498158 ppf: 843 ppct: 12 formats: tig: atl: A Dynamic Disequilibrium Comparison of Fixed and Free Exchange-Rate Regimes. aug: au: Chan, Kenneth S. affil: Assistant Professor of Economics, Saint Mary's University. su: Foreign exchange rates Demand function Economic equilibrium Foreign exchange Unemployment Time & economic reactions Commercial products Labor market sug: subj: Foreign exchange rates Demand function Economic equilibrium Foreign exchange Unemployment Time & economic reactions Commercial products Labor market ab: This article constructs a disequilibrium model that traces out the long-run time path of different exchange-rate regimes. It assumes that the money wage adjusts slowly and transactions can occur at labor market disequilibrium. Unemployment generated from this type of economic behavior is typically involuntary. The article begins with the development of analytical framework of the model. It then analyzes the short-run level of unemployment for each exchange-rate regime and examines the long-run time paths for each regime. The article considers a simplified analytical framework which deals with 5 economic goods, a nontraded good, an import good, an export good, money, and labor services. There are four markets, the home good market, the foreign exchange market, the money market, and the labor market. There is no investment demand and no international capital flows. A two-stage adjustment process is also assumed. In the first stage, a short time interval is used in which the price of home goods adjusts to clear the home good market, and either the exchange rate or money stock in the respective free or fixed exchange-rate regime adjusts to clear the balance of payments. In the second stage, a long time horizon is used during which the nominal wage is allowed to adjust to clear the labor market. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: Y dt: @attributes: year: 1979 holdings: @attributes: islocal: N |
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