Bitte verwenden Sie diesen Link, um diese Publikation zu zitieren, oder auf sie als Internetquelle zu verweisen: https://hdl.handle.net/10419/152607 
Erscheinungsjahr: 
2002
Schriftenreihe/Nr.: 
ECB Working Paper No. 173
Verlag: 
European Central Bank (ECB), Frankfurt a. M.
Zusammenfassung: 
This paper shows that the conditions under which inflation-targeting interest rate rules lead to equilibrium uniqueness in a small open economy in general differ from those in a closed economy. As the monetary authority adjusts nominal interest rates in response to inflation, the real interest rate changes. The overall effect of this change on aggregate demand has important implications for equilibrium determinacy. In an open economy, an increase in the real interest rate is transmitted to aggregate demand through an intertemporal substitution effect, as in a closed economy, but also through a terms of trade effect that is absent in the closed economy. These effects move aggregate demand in opposite directions. We find that, in a broad class of models, the conditions for local equilibrium uniqueness depend crucially on the degree of openness to international trade. Openness matters not only quantitatively, but also qualitatively.
Schlagwörter: 
indeterminacy
interest rate rules
small open economy
Terms of Trade
JEL: 
E52
E58
F41
Dokumentart: 
Working Paper

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