Essays on Rational Expectations and Flexible Exchange Rates

Includes bibliographies and index.

Cover; Half Title; Title; Copyright; Original Title; Original Copyright; Contents; I. INTRODUCTION AND OVERVIEW; 1.1 Introduction; 1.2 International Transmission of Economic Disturbances; 1.3 Real Exchange Rate Models; 1.4 The Exchange Rate and the Terms of Trade; 1.5 Deviations from Purchasing Power Parity; II. FLUCTUATING EXCHANGE RATES AND THE INTERNATIONAL TRANSMISSION OF ECONOMIC DISTURBANCES; 2.1 Introduction; 2.2 A Stochastic Model of Exchange Rate Determination; 2.3 Output and the Exchange Rate Under Full Current Information; 2.4 Characteristics of the Solutions for ẽt and ỹt

2.5 The Impact of Imperfect Information2.6 Monetary Policy and the Exchange Rate; 2.7 Sources of World Price Movements; 2 . 8 Exchange Rate Variability; 2.9 Concluding Comments; III. ""REAL"" AND NOMINAL EXCHANGE RATES IN AN UNCERTAIN WORLD: THE TRADED NON-TRADED GOODS NEXUS; 3.1 Introduction; 3.2 Traded, Non-Traded Goods: A Stochastic Equilibrium Model; 3.3 A Formal Solution and the Formation of Expectations; 3.4 Prices and Outputs with Full Information; 3.5 Impact of Incomplete Current Information; 3.6 Conclusions and Extensions

IV. CYCLICAL VARIATIONS OF THE EXCHANGE RATE AND THE TERMS OF TRADE4.1 Introduction; 4.2 A Stochastic Two-Country Flexible Exchange Rate Model; 4.3 Solution of the Model and the Formation of Expectations; 4.4 Full Current Information Solution; 4.5 The Impact of Incomplete Current Information; 4.6 Concluding Remarks; V. RATIONAL EXPECTATIONS, PURCHASING POWER PARITY AND THE BUSINESS CYCLE; 5.1 Introduction; 5.2 A Decentralized Model of Trade and Production; 5.3 Market-Clearing Determination of Price and Output in z; 5.4 Market-Clearing in the Typical z* Market

5.5 A Centralized Market for Foreign Exchange5.6 Rational Expectations; 5.7 The Full Current Information Solution; 5.8 The Impact of Incomplete Current Information (I.C.I.); 5.9 Solutions in Special Cases; 5.10 Concluding Comments; BIBLIOGRAPHY; APPENDIX

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