Asset markets and foreign exchange intervention: A model of the Belgo-Luxemburg economic union

Adam, Marie Christine

doi:10.1016/0161-8938(82)90017-5

Cited by 5 publications

(3 citation statements)

References 4 publications

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“…Adam, 1982;Artus, 1976;Avery, 1979;Basevi and Calzolari, 1983;Marothia and Phillips, 1982;Ujiie, 1978). Adam, 1982;Artus, 1976;Avery, 1979;Basevi and Calzolari, 1983;Marothia and Phillips, 1982;Ujiie, 1978).…”

Section: Introductionmentioning

confidence: 99%

“…Our paper thus belongs to the already substantial body of literature concerned with the estimation of policy reaction functions (e.g. Adam, 1982;Artus, 1976;Avery, 1979;Basevi and Calzolari, 1983;Marothia and Phillips, 1982;Ujiie, 1978). Most previous attempts can be (re)interpreted in terms of a partial adjustment mechanism of a policy instrument to a desired level (see e.g.…”

Section: Introductionmentioning

confidence: 99%

“…Most previous attempts can be (re)interpreted in terms of a partial adjustment mechanism of a policy instrument to a desired level (see e.g. Adam, 1982;Artus, 1976;Ujiie, 1978-a notable exception is Avery, 1979). They, however, usually rely on ad hoc formulations of both target levels and expectations, and fail to take account of the close relationship that exists between targets, adjustment lags and expectations.…”

Section: Introductionmentioning

confidence: 99%

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Money stock targeting and money supply: An intertemporal optimization approach (with an application to Canada)

Mercenier

Sekkat

1988

J of Applied Econometrics

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We propose a model of the short‐term behaviour of the monetary authorities of a small open economy that is willing to stabilize, to some extent, its bilateral exchange rate vis‐à‐vis a dominant partner. The optimal money supply strategy is derived using intertemporal optimization arguments, in a rational expectations environment, The model is formulated so as to avoid the time inconsistency problem stressed by Kydland and Prescott (1977). It allows econometric estimation of the optimal money supply rule as well as of the parameters of the intertemporal utility function, and of the function that defines the intermediate target money stock. The model is successfully estimated on Canadian quarterly data, using maximum‐likelihood techniques.

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