Habits and Durability in Consumption, and the Effects of Exchange Rate Policies

Arman Mansoorian and Simon Neaime

Working Papers from York University, Department of Economics

Abstract: A model in which consumption exhibits durability, and habits develop over the flow of services provided by them, is used to study the effects of exchange rate policies. The results of recent studies with regard to the effects of exchange rate policies are brought closer to some recent empirical findings. It is shown that, after a change in the rate of devaluation, the adjustment of consumption, real money holdings, and the country's net foreign asset position will very likely be non-monotonic.

Keywords: Habits; Durability in Consumption; Exchange Rate Policies (search for similar items in EconPapers)
JEL-codes: F31 F32 F41 (search for similar items in EconPapers)
Pages: 19 pages
Date: 1996-06
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ftp://dept.econ.yorku.ca/pub/working_papers/96-06.pdf First version, 1996

Related works:
Journal Article: Habits And Durability In Consumption And The Effects Of Exchange Rate Policies (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:yca:wpaper:1996_06

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