Business Cycle Asymmetries and the Nominal Exchange Rate Regimes

The exchange rate in a dynamic-optimizing business cycle model with nominal rigidities: a quantitative investigation

This paper studies a quantitative dynamic-optimizing business cycle model of a small open economy with staggered price and wage setting. The model exhibits exchange rate overshooting in response to money supply shocks. The predicted variability of the nominal and, especially, of the real exchange rate is noticeably higher than in standard Real Business Cycle models with flexible prices and wage...

Capacity Constraints , Asymmetries , and the Business Cycle

Policy Time-Inconsistency: A Comparison of Managed Floating Exchange Rate and Controlled Exchange Rate Regimes

Some empirical and theoretical studies have emphasized on fixed exchange rate regime in controlling time inconsistency, while others consider the role of target zone regime as an important factor. Thus there is no general consensus to decide which exchange rate regime may bring about less time-inconsistency. The main purpose of this study is to investigate policy time-inconsistency in exchange ...

Macroeconomic effects of nominal exchange rate regimes: new insights into the role of price dynamics

This paper analyzes the effects of pegged and floating exchange rates using a two-country dynamic general equilibrium model that is calibrated to the US and a European aggregate. The model assumes shocks to money, productivity and the interest rate parity condition. It captures the fact that the sharp increase in nominal exchange rate volatility after the end of the Bretton Woods (BW) system wa...

The impact of exchange rate on economic growth under different exchange rate regimes (in selected countries developed and developing)

This paper examines the role of different exchange rate regimes on relationship between  exchange rate volatility and economic growth. To investigate this relationship, information of 53 countries with floating and fixed exchange rate regimes in the period of 1987-2016 are considered. GARCH technique is used to estimate exchange rate volatility and Difference GMM technique for estimating the mo...