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External Imbalances and Macroeconomic Policy in New Zealand

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  • Philip R. Lane

    ()
    (Institute for International Integration Studies, Trinity College Dublin)

Abstract

This paper argues that large external imbalances pose signifi?cant macroeconomic risks for New Zealand. While New Zealand has coped well in recent years, the global fi?nancial crisis has underlined the vulnerability of defi?cit countries to fi?nancial shocks. New Zealand can draw important lessons from the global crisis by adjusting its macroeconomic policy framework to further mitigate the risks embedded in its international balance sheet.

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Bibliographic Info

Paper provided by IIIS in its series The Institute for International Integration Studies Discussion Paper Series with number iiisdp376.

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Length: 44 pages
Date of creation: Nov 2011
Date of revision:
Handle: RePEc:iis:dispap:iiisdp376

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Keywords: New Zealand; external imbalances; macroeconomic policy;

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References

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  1. Richard Fabling & Arthur Grimes & Lynda Sanderson, 2011. "Whatever next? Export market choices of New Zealand firms," ERSA conference papers ersa10p367, European Regional Science Association.
  2. Morten O. Ravn & Stephanie Schmitt-Grohé & Martín Uribe, 2007. "Explaining the Effects of Government Spending Shocks on Consumption and the Real Exchange Rate," NBER Working Papers 13328, National Bureau of Economic Research, Inc.
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  9. André Faria & Philip R. Lane & Paolo Mauro & Gian Maria Milesi-Ferretti, 2007. "The Shifting Composition of External Liabilities," Journal of the European Economic Association, MIT Press, MIT Press, vol. 5(2-3), pages 480-490, 04-05.
  10. Galstyan, Vahagn A. & Lane, Philip R., 2008. "The Composition of Government Spending and the Real Exchange Rate," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6903, C.E.P.R. Discussion Papers.
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  17. Vahagn Galstyan and Philip R. Lane, 2008. "External Imbalances and the Extensive Margin of Trade," The Institute for International Integration Studies Discussion Paper Series, IIIS iiisdp259, IIIS.
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Cited by:
  1. Tervala, Juha, 2012. "International welfare effects of monetary policy," Journal of International Money and Finance, Elsevier, Elsevier, vol. 31(2), pages 356-376.

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