Three Exchange Rate Regimes and a Monetary Union: Determinacy, Currency Crises, and Welfare
AbstractWe study three different exchange rate regimes in a stochastic OLG model with free capital mobility and incomplete markets. The regimes are characterized by the type of coordinated seignorage financed transfer (or fiscal) policy in place. We are especially interested in how the different types of policies affect the possibility of sunspot equilibria with real and/or nominal effects.
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Bibliographic InfoPaper provided by Banco de Espa�a in its series Banco de Espa�a Working Papers with number 0104.
Length: 32 pages
Date of creation: 2001
Date of revision:
exchange rate; central banks; currencies;
Find related papers by JEL classification:
- D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
- D60 - Microeconomics - - Welfare Economics - - - General
- D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
- F31 - International Economics - - International Finance - - - Foreign Exchange
- F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
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