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dc.contributor.authorBergin, Paulen_US
dc.contributor.authorShin, Hyung-Cheolen_US
dc.contributor.authorTchakarov, Ivanen_US
dc.date.accessioned2006-01-04en_US
dc.date.accessioned2010-05-14T11:03:43Z-
dc.date.available2010-05-14T11:03:43Z-
dc.date.issued2005en_US
dc.identifier.urihttp://hdl.handle.net/10419/31308-
dc.description.abstractThis paper evaluates quantitatively the potential welfare gains from monetary policy and fixed exchange rate rules in a two-country sticky-price model. The first finding is that the gains from stabilization tend to be small in the types of economic environments emphasized in recent theoretical literature. The analysis goes on to identify two types of economies in which the welfare implications of risk are larger: where agents exhibit habits, and where international asset markets exhibit asymmetry in the form of “original sin.” In the habits case, monetary policy aimed solely at inflation stabilization is optimal. But in the original sin case there are potentially large welfare gains from also eliminating exchange rate volatility.en_US
dc.language.isoengen_US
dc.publisherDep. of Economics, Univ. of California Davis, Calif.en_US
dc.relation.ispartofseriesWorking papers // University of California, Department of Economics 05,12en_US
dc.subject.jelF41en_US
dc.subject.ddc330en_US
dc.subject.stwWechselkursrisikoen_US
dc.subject.stwWohlfahrtseffekten_US
dc.subject.stwZwei-Länder-Modellen_US
dc.subject.stwFinanzmarkten_US
dc.subject.stwTheorieen_US
dc.titleDoes exchange rate variability matter for welfare? A quantitative investigation of stabilization policiesen_US
dc.typeWorking Paperen_US
dc.identifier.ppn505103575en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
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