Secular Inflation and Dynamics of Exchange Rates under Perfect Myopic Foresight
研究了在长期通胀世界中，小型开放经济在浮动汇率制下的汇率动态，分析了货币与财政扩张的影响，尤其关注经济开放度对系统稳定性的作用。
This paper considers a model of a small open economy operating under flexible exchange rates in a world of secular inflation. The analysis is based on the rational expectations methodology in that appropriate variables are allowed to undergo discrete jumps, whenever the system is subject to some exogenous shock, so as to ensure that it remains stable. The nature of the jump depends upon the inherent stability characteristics of the system. This in turn depends upon a number of parameters of the economy, particularly its degree of openness. Both monetary and fiscal expansions are analyzed, with the relatively open economy being of greater interest and discussed in detail.