IDEAS home Printed from https://ideas.repec.org/a/dug/actaec/y2013i5p103-170.html

A Mathematical Model of an Open Economy with Applications in Romania

Author

Listed:
  • Catalin Angelo Ioan

    (Danubius University of Galati)

  • Gina Ioan

    (Danubius University of Galati)

Abstract

In this paper, we first study the static equilibrium of a a closed economy model in terms of dependence on national income and interest rate from the main factors namely the marginal propensity to consume, tax rate, investment rate and the rate of currency demand. In the second part, we study the dynamic equilibrium solutions in terms of stability. We thus obtain the variation functions of national income and interest rate variation and their limit values. Finally, we propose two scenarios of economic development of Romania.

Suggested Citation

  • Catalin Angelo Ioan & Gina Ioan, 2013. "A Mathematical Model of an Open Economy with Applications in Romania," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 9(5), pages 103-170, October.
    • Handle: RePEc:dug:actaec:y:2013:i:5:p:103-170
    as

    Download full text from publisher

    File URL: http://journals.univ-danubius.ro/index.php/oeconomica/article/view/1853/1908
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Justiniano, Alejandro & Preston, Bruce, 2010. "Can structural small open-economy models account for the influence of foreign disturbances?," Journal of International Economics, Elsevier, vol. 81(1), pages 61-74, May.
    2. Paul R. Bergin, 2017. "How Well Can the New Open Economy Macroeconomics Explain the Exchange Rate and Current Account?," World Scientific Book Chapters, in: International Macroeconomic Interdependence, chapter 5, pages 117-152, World Scientific Publishing Co. Pte. Ltd..
    3. F. H. Hahn, 1977. "Keynesian Economics and General Equilibrium Theory: Reflections on Some Current Debates," International Economic Association Series, in: G. C. Harcourt (ed.), The Microeconomic Foundations of Macroeconomics, chapter 1, pages 25-40, Palgrave Macmillan.
    4. Philip A. Lawn, 2003. "Environmental Macroeconomics: Extending the IS–LM Model to Include an ‘Environmental Equilibrium’ Curve," Australian Economic Papers, Wiley Blackwell, vol. 42(1), pages 118-134, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Catalin Angelo Ioan & Gina Ioan, 2013. "An Equilibrium Model for an Open Economy. Romania’s Case," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 9(1), pages 102-125, February.
    2. Bhattarai, Keshab & Mallick, Sushanta K. & Yang, Bo, 2021. "Are global spillovers complementary or competitive? Need for international policy coordination," Journal of International Money and Finance, Elsevier, vol. 110(C).
    3. Milani, Fabio, 2011. "The impact of foreign stock markets on macroeconomic dynamics in open economies: A structural estimation," Journal of International Money and Finance, Elsevier, vol. 30(1), pages 111-129, February.
    4. Ca’ Zorzi, Michele & Kolasa, Marcin & Rubaszek, Michał, 2017. "Exchange rate forecasting with DSGE models," Journal of International Economics, Elsevier, vol. 107(C), pages 127-146.
    5. P. Jacob, 2010. "Disaggregating Real Exchange Rate Dynamics: A Structural Approach," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 10/655, Ghent University, Faculty of Economics and Business Administration.
    6. Jacob, Punnoose & Peersman, Gert, 2013. "Dissecting the dynamics of the US trade balance in an estimated equilibrium model," Journal of International Economics, Elsevier, vol. 90(2), pages 302-315.
    7. Houssa, Romain & Mohimont, Jolan & Otrok, Christopher, 2023. "Commodity exports, financial frictions, and international spillovers," European Economic Review, Elsevier, vol. 158(C).
    8. Rabanal, Pau & Tuesta, Vicente, 2010. "Euro-dollar real exchange rate dynamics in an estimated two-country model: An assessment," Journal of Economic Dynamics and Control, Elsevier, vol. 34(4), pages 780-797, April.
    9. Kolasa, Marcin & Rubaszek, Michał, 2018. "Does the foreign sector help forecast domestic variables in DSGE models?," International Journal of Forecasting, Elsevier, vol. 34(4), pages 809-821.
    10. Justiniano, Alejandro & Preston, Bruce, 2010. "Can structural small open-economy models account for the influence of foreign disturbances?," Journal of International Economics, Elsevier, vol. 81(1), pages 61-74, May.
    11. Gregory De Walque & Thomas Lejeune & Yuliya Rychalovska & Rafael Wouters, 2017. "An estimated two-country EA-US model with limited exchange rate pass-through," Working Paper Research 317, National Bank of Belgium.
    12. Kano, Takashi, 2024. "Trend inflation and exchange rate dynamics: A new Keynesian approach," Journal of International Money and Finance, Elsevier, vol. 146(C).
    13. Alejandro Justiniano & Bruce Preston, 2010. "Monetary policy and uncertainty in an empirical small open‐economy model," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 25(1), pages 93-128, January.
    14. Tervala, Juha, 2013. "Learning by devaluating: A supply-side effect of competitive devaluation," International Review of Economics & Finance, Elsevier, vol. 27(C), pages 275-290.
    15. Daniele Siena, 2014. "The European Monetary Union and Imbalances: Is it an Anticipation Story ?," Working papers 501, Banque de France.
    16. Albonico, Alice & Tirelli, Patrizio, 2020. "Financial crises and sudden stops: Was the European monetary union crisis different?," Economic Modelling, Elsevier, vol. 93(C), pages 13-26.
    17. Herrmann, Sabine & Kleinert, Jörn, 2014. "Lucas paradox and allocation puzzle: Is the euro area different?," Discussion Papers 06/2014, Deutsche Bundesbank.
    18. Benchimol, Jonathan & Ivashchenko, Sergey, 2021. "Switching volatility in a nonlinear open economy," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 110, pages 1-31.
    19. Lindé, Jesper & Smets, Frank & Wouters, Rafael, 2016. "Challenges for Central Banks´ Macro Models," Working Paper Series 323, Sveriges Riksbank (Central Bank of Sweden).
    20. Corbo, Vesna & Di Casola, Paola, 2018. "Conditional exchange rate pass-through: evidence from Sweden," Working Paper Series 352, Sveriges Riksbank (Central Bank of Sweden).

    More about this item

    Keywords

    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dug:actaec:y:2013:i:5:p:103-170. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Daniela Robu (email available below). General contact details of provider: https://edirc.repec.org/data/fedanro.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.