This paper explores the main channels of international transmission of economic disturbances under the Bretton Woods System and presents evidence on the short-run international transmission of inflation under that system. There appears to have been little short-run international transmission of inflation. Countries with one-percent higher money-growth rates subsequently had one-fourth to one-half percent higher inflation and a (predictably) lower real interest rate. This probably reflects effects of money growth on inflation and interest rates rather than reverse causation: the natural interpretation of the evidence is that countries had some scope for monetary-policy independence under Bretton Woods, despite pegged exchange rates, and exercised that independence in ways that limited international transmission.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
4127.
Length: Date of creation: Jul 1992 Date of revision: Publication status: published relationship to a non-chapter. This should not happen. Please contact NBER. Handle: RePEc:nbr:nberwo:4127
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Chapter
Alan C. Stockman, 1993.
"International Transmission under Bretton Woods,"
NBER Chapters,
in: A Retrospective on the Bretton Woods System: Lessons for International Monetary Reform, pages 317-356
National Bureau of Economic Research, Inc.
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References listed on IDEAS 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.:
Michael R. Darby & James R. Lothian & Arthur E. Gandolfi & Anna J. Schwartz & Alan C. Stockman, 1983.
"The International Transmission of Inflation,"
NBER Books,
National Bureau of Economic Research, Inc, number darb83-1.
Maurice Obstfeld & Alan C. Stockman, 1985.
"Exchange-Rate Dynamics,"
NBER Working Papers
1230, National Bureau of Economic Research, Inc.
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Other versions:
Obstfeld, Maurice & Stockman, Alan C., 1985.
"Exchange-rate dynamics,"
Handbook of International Economics,
in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 2, chapter 18, pages 917-977
Elsevier.
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