IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

L'interdépendance des économies en change flexible : les apports d'une maquette dynamique

  • Henri Sterdyniak
  • Éric Bleuze

[eng] Iterdependence of economies under flexible exchange rates : the contributions of dynamic model This paper present a dynamic model in order to analyse interdependence between two identical countries under flexible exchange rates. The dynamic process is depending on slow adjustment of prices to their desired level (which is positively related to real interest rate) combined with the influence of current account on foreign exchange markets. On the short run, the exchange rate is determined by financial factors ; on the long run by current account. So the model gives a classical long term equilibrium reached on a keynesian trajectory. Following a disturbance, the new equilibrium is obtained slowly with complex trajectories, which are difficult to forecast. This leads us to be skeptic concerning the realism of the rational expectations hypothesis. Flexible exchange rates are unable to isolate each country from the schocks occurred in the other. More precisely, both countries suffer from a degradation of supply conditions in one of them. A demand expansion in one country provokes a temporary production rise, followed by a long depression especially in the initiating country, whose exchange rate is progressively depreciated. [fre] L'interdépendance des économies en change flexible : les apports d'une maquette dynamique L'article présente une maquette dynamique qui permet d'analyser l'interdépendance de deux pays de taille similaire en change flexible. La dynamique repose sur l'ajustement lent des prix à leur niveau désiré (qui est une fonction croissante du taux d'intérêt réel) et sur l'influence de la balance courante sur le marché des changes : le taux de change est déterminé, à court terme, par des facteurs financiers, à long terme, par la balance courante. Aussi, la maquette a un long terme classique et une trajectoire keynésienne. A la suite d'un choc, le retour à l'équilibre est souvent long et les trajectoires complexes et difficilement prévisibles, ce qui jette un doute sur le réalisme de l'hypothèse d'anticipations rationnelles. La flexibilité des changes n 'isole guère chaque pays des chocs survenant chez son partenaire. En particulier, les deux pays souffrent d'une dégradation des conditions de l'offre survenant dans l'un deux ; une hausse de la demande dans l'un des pays provoque une expansion temporaire de la production puis une phase prolongée de dépression, surtout marquée dans le pays initiateur : celui-ci voit son taux de change se déprécier progressivement.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://dx.doi.org/doi:10.3406/reco.1988.409110
Download Restriction: Data and metadata provided by Persée are licensed under a Creative Commons "Attribution-Noncommercial-Share Alike 3.0" License http://creativecommons.org/licenses/by-nc-sa/3.0/

File URL: http://www.persee.fr/doc/reco_0035-2764_1988_num_39_5_409110
Download Restriction: Data and metadata provided by Persée are licensed under a Creative Commons "Attribution-Noncommercial-Share Alike 3.0" License http://creativecommons.org/licenses/by-nc-sa/3.0/

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Programme National Persée in its journal Revue économique.

Volume (Year): 39 (1988)
Issue (Month): 5 ()
Pages: 999-1034

as
in new window

Handle: RePEc:prs:reveco:reco_0035-2764_1988_num_39_5_409110
Note: DOI:10.3406/reco.1988.409110
Contact details of provider: Web page: http://www.persee.fr/collection/reco

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.:

as in new window
  1. Henderson, Dale W. & Rogoff, Kenneth, 1982. "Negative net foreign asset positions and stability in a world portfolio balance model," Journal of International Economics, Elsevier, vol. 13(1-2), pages 85-104, August.
  2. Jorge Braga de Macedo & David M. Meerschwam, 1985. "Exchange Rate Flexibility and the Transmission of Business Cycles," NBER Working Papers 1573, National Bureau of Economic Research, Inc.
  3. Jean-Paul Pollin & François Chevallier, 1985. "La transmission internationale des chocs monétaires en changes flexibles," Revue Économique, Programme National Persée, vol. 36(6), pages 1301-1344.
  4. Jean-Paul Fitoussi & Edmund S Phelps, 1987. "Politique économique aux Etats-Unis et croissance du chômage en Europe," Sciences Po publications info:hdl:2441/5951, Sciences Po.
  5. William H. Branson & Julio J. Rotemberg, 1981. "International adjustment with wage rigidity," NBER Chapters, in: International Seminar on Macroeconomics, pages 309-332 National Bureau of Economic Research, Inc.
  6. Dornbusch, Rudiger, 1976. "Expectations and Exchange Rate Dynamics," Journal of Political Economy, University of Chicago Press, vol. 84(6), pages 1161-76, December.
  7. Wyplosz, Charles A., 1983. "The exchange and interest rate term structure under risk aversion and rational expectations," Journal of International Economics, Elsevier, vol. 14(1-2), pages 123-139, February.
  8. Nicholas Sarantis, 1986. "The Mundell-Fleming Model with Perfect Capital Mobility and Oligopolistic Pricing," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 9(1), pages 138-148, October.
  9. Maurice Obstfeld, 1981. "Aggregate Spending and the Terms of Trade: Is There a Laursen-Metzler Effect?," NBER Working Papers 0686, National Bureau of Economic Research, Inc.
  10. Blanchard, Olivier J, 1979. "Backward and Forward Solutions for Economies with Rational Expectations," American Economic Review, American Economic Association, vol. 69(2), pages 114-18, May.
  11. Blanchard, Olivier Jean & Kahn, Charles M, 1980. "The Solution of Linear Difference Models under Rational Expectations," Econometrica, Econometric Society, vol. 48(5), pages 1305-11, July.
  12. Daniel, Betty C, 1981. "The International Transmission of Economic Disturbances under Flexible Exchange Rates," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(3), pages 491-509, October.
  13. Currie, David A, 1985. "Structural Instability in a Rational Expectations Model of a Small Open Economy with a J-Curve," Economica, London School of Economics and Political Science, vol. 52(205), pages 25-36, February.
  14. Jeffrey Sachs, 1980. "Wages, Flexible Exchange Rates, and Macroeconomic Policy," The Quarterly Journal of Economics, Oxford University Press, vol. 94(4), pages 731-747.
  15. F. Chevallier & Jean-Paul Pollin, 1985. "La transmission internationale des chocs monétaires en changes flexibles," Post-Print halshs-00287651, HAL.
  16. Driskill, Robert, 1981. "Exchange rate overshooting, the trade balance, and rational expectations," Journal of International Economics, Elsevier, vol. 11(3), pages 361-377, August.
  17. Masson, Paul R., 1981. "Dynamic stability of portfolio balance models of the exchange rate," Journal of International Economics, Elsevier, vol. 11(4), pages 467-477, November.
  18. Svensson, Lars E O & Razin, Assaf, 1983. "The Terms of Trade and the Current Account: The Harberger-Laursen-Metzler Effect," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 97-125, February.
  19. Argy, Victor & Salop, Joanne, 1983. "Price and Output Effects of Monetary and Fiscal Expansion in a Two-Country World under Flexible Exchange Rates," Oxford Economic Papers, Oxford University Press, vol. 35(2), pages 228-46, July.
  20. William H. Branson, 1976. "The Dual Roles of the Government Budget and the Balance of Payments in the Movement from Short-Run to Long-Run Equilibrium," The Quarterly Journal of Economics, Oxford University Press, vol. 90(3), pages 345-367.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:prs:reveco:reco_0035-2764_1988_num_39_5_409110. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Equipe PERSEE)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.