The simple geometry of transmission and stabilization in closed and open economies

Giancarlo Corsetti and Paolo Pesenti

No 209, Staff Reports from Federal Reserve Bank of New York

Abstract: This paper provides an introduction to the recent literature on macroeconomic stabilization in closed and open economies. We present a stylized theoretical framework, illustrating its main properties with the help of an intuitive graphical apparatus. Among the issues we discuss are optimal monetary policy and the welfare gains from macroeconomic stabilization, the international transmission of real and monetary shocks and the role of exchange rate pass-through, and the design of optimal exchange rate regimes and monetary coordination among interdependent economies.

Keywords: Foreign exchange rates; Monetary policy; Macroeconomics (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (24)

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Related works:
Chapter: The Simple Geometry of Transmission and Stabilization in Closed and Open Economies (2009)
Working Paper: The Simple Geometry of Transmission and Stabilization in Closed and Open Economies (2005)
Working Paper: The simple geometry of transmission and stabilization in closed and open economies (2005)
Working Paper: The Simple Geometry of Transmission and Stabilization in Closed and Open Economies (2005)
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