Monetary and Fiscal Policy, the Exchange Rate and Foreign Wealth [Paperback]

The book investigates issues of policy design in open economies. The performance of simple alternative policy rules is analysed in the context of theoretical models using both analytical solutions and numerical simulations techniques. One of the substantive contributions of the research is that policy evaluation should take into account, among other things, the implications of different rules for foreign wealth and the exchange rate. Hence the open economy models presented in the book include wealth effects and the current account.Preface - The Design of Simple Rules for the Open Economy - Open Economy Models: The Macroeconomic Approach - Monetarist Macroeconomic Policy Rules in a Small Open Economy Model - Simple Policy Rules for the Open Economy: Evaluating Alternative Proposals - Macroeconomic Policy and Interdependence: the Debate on International Policy Coordination - Simple Rules for Policy Coordination: An Evaluation of Alternative Assignments - Concluding Remarks - References - Index