Dynamic Analysis Of Open Economies
Published on 1. January 2014
368 pages
978-0-323-14080-5 (ISBN)
Description
Dynamic Analysis of Open Economies focuses on the dynamic behavior of open economies in general, and dynamic interactions among several interconnected economies in particular. The emphasis is on the techniques of dynamic analysis and on the dynamic responses of models of open economies. This book is organized into three sections and consists of 15 chapters that examine how macroeconomic policy instruments affect open economies under flexible exchange rate regimes and the extent to which interdependence of national economies affects assessment of national policy effectiveness in a dynamic context. The behavior of open economies is analyzed not only at the instant of exogenous shocks or changes in instruments, but also after some time has elapsed since the last impacts. In considering the importance of dynamics, the book describes the behavior of a wide range of models and draws general conclusions. A set of techniques associated with variational analysis and perturbation theory is developed and systematically applied to models of open economies. This section also offers an analytical innovation for dealing with models of the world that are composed of several countries and demonstrates the usefulness of path controllability. The remaining chapters are devoted to models of small open economies and two- and multiple-country models of the world, paying particular attention to monetary policy and its distributional effects. Students and practitioners of applied mathematics and econometrics will find this book extremely helpful.
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Masanao Aoki
Dynamic Analysis of Open Economies
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01/1981
Academic Press
€86.05
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Content
PrefaceScope of the InvestigationNotationList of SymbolsPart One Analytical Concepts and Tools of Comparative Dynamic Analysis 1 State-Space Representation of Dynamic Models 1.1 Analytical Models 1.2 State-Space Representation 1.3 Notion of Equilibrium and Long-Run Policy Implications 1.4 Example: A Balanced Growth Path of a Small Open Economy 2 Variational Methods in Comparative Dynamic Analysis 2.1 Introduction 2.2 Reference Time Paths 2.3 Variational Equations 2.4 Sensitivity Analysis 3 Variational Dynamic Equation: An Example of Fiscal Policy in a Macroeconomic Model 3.1 Model 3.2 Momentary Equilibrium 3.3 Dynamics 3.4 Long-Run Equilibrium 3.5 Variational Relations: Shifting Momentary Equilibrium 3.6 Variational Dynamics Appendix 4 Dynamic Policy Multipliers (Impulse Response Functions) 4.1 Dynamic Multipliers of Continuous Time Models 4.2 Discrete-Time Policy Multiplier 4.3 Multiplier in a Small Open Economy: An Example 5 How to Evaluate Structural Differences: Application of Perturbation Theory 5.1 Basic Procedure 5.2 Structural Perturbation Method 5.3 Choice of State Vectors in Models of Interdependent Economies 5.4 Example: Effects of Trade on National Incomes 6 Controllability and Theory of Economic Policy 6.1 Controllability 6.2 Path Controllability 6.3 Policies with No Spill-Over Effects 6.4 Stabilizability 6.5 Example 7 Linkages of National Economies 7.1 Introduction 7.2 Interest Rate Linkage 7.3 Price Linkages 7.4 Terms-of-Trade Linkage 7.5 Expectations 8 Sources of Dynamics and Their Interactions 8.1 Variational Dynamic Equations 8.2 Example 8.3 Regressive Expectations and Consistency cum Stability 8.4 ExamplePart Two Small Open Economies 9 A Growing Economy: Influences of Capital Growth on the Dynamic Multiplier 9.1 The Model 9.2 Fiscal Multipliers 9.3 Numerical Example 9.4 Discussions and Summaries 10 Stabilization Policies in a Small Open Economy 10.1 The Model 10.2 Long-Run Equilibrium 10.3 Variational Differential Equations 10.4 Short-Run Stability of the Variational Dynamics 10.5 Policy Reaction Functions Appendix Appendix 11 Short-Run Comparative Dynamic Analysis of a Small Open Economy with Variable Wage Rates 11.1 The Model 11.2 Long-Run Equilibrium 11.3 Short-Run Analysis 11.4 Are Variable Wage Rates More Inflationary? An Example of Structural Perturbation Analysis 11.5 Numerical Examples 11.6 Elaborations Appendix The Variational Disposable Income ExpressionPart Three Multiple-Country Models of the World 12 Two-Country Model: A Preliminary Analysis 12.1 Implications of Structural Differences 12.2 Distributional Effects of Monetary Policies 13 Monetary Policies in a Two-Country Model of the World 13.1 Introduction 13.2 Structural Perturbation Analysis 13.3 Policy Sensitivity and Distributional Effects 13.4 The Model 13.5 Reduced Form Equations of the Reference Variational Model VMo 13.6 Dynamics of the Reference Model 13.7 Dynamics of VM 13.8 Policy Effects 13.9 Elaborations on the Basic Model 13.10 Numerical Examples Appendix Calculation of the Averages and the Differences 14 Two-Country Model of the World under Key Currency Regime 14.1 Introduction 14.2 The Model 14.3 Variational Dynamics 14.4 Stability Analysis under Rigid Wage Rates 14.5 Stability: Flexible Wage Rates 14.
