SpringerBriefs in Economics: A General Framework Based on the Mundell-Fleming Model

Bajo-Rubio, Oscar; Díaz-Roldán, Carmen

The book develops a general framework for the macroeconomic modeling of monetary unions. The starting point of the analysis is the standard two-country Mundell-Fleming model with perfect capital mobility, extended to incorporate the supply side in a context of rigid real wages, and modified so that the money market is common for two countries forming a monetary union. The model is presented in two versions: for a small and a large monetary union, respectively. After solving each model, the authors derive multipliers for monetary, expenditure, supply, and external shocks, both in the short and the long run; a graphical analysis is also provided. Special attention is paid to the crucial distinction between symmetric and asymmetric shocks.

Details

Published by: Springer

Publication Date: 2011-05-08

Format: Paperback

ISBN-13: 9783642194443

DOI: 10.1007/978-3-642-19445-0

Dimensions: 235cm x155cm

Pages: 50