Teaching Post Keynesian exchange rate theory
AbstractThe goal of this paper is to provide a model and method for those wishing to include the Post Keynesian perspective when teaching exchange rate theory. It begins by reviewing neoclassical approaches (purchasing power parity, the monetary model, and the Dornbusch model) and then develops a graphical Post Keynesian model that is based on Keynes's Z-D diagram, endogenous money, a currency market driven by portfolio capital flows, and no assumption of a tendency toward full employment or balanced trade. The model is then used to look at historical examples and policy.
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Bibliographic InfoArticle provided by M.E. Sharpe, Inc. in its journal Journal of Post Keynesian Economics.
Volume (Year): 30 (2007)
Issue (Month): 2 (December)
Contact details of provider:
Web page: http://mesharpe.metapress.com/link.asp?target=journal&id=109348
Dornbusch model; exchange rates; monetary model; Post Keynesian; purchasing power parity; teaching economics;
Other versions of this item:
- F31 - International Economics - - International Finance - - - Foreign Exchange
- A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lucio Sarno & Mark P. Taylor, 2002.
"Purchasing Power Parity and the Real Exchange Rate,"
IMF Staff Papers,
Palgrave Macmillan, vol. 49(1), pages 5.
- Sarno, Lucio & Taylor, Mark P, 2001. "Purchasing Power Parity and the Real Exchange Rate," CEPR Discussion Papers 2913, C.E.P.R. Discussion Papers.
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