Abstract
Recent monetary events have cast doubt on the traditional view that floating exchange rates eliminate the international transmission of price disturbances and allow increased policy autonomy. While exchange rate flexibility in the absence of official intervention have blunted the customary channels of transmission of nominal disturbances through changes in the reserve component of the domestic monetary base, other novel but equally pervasive channels of transmission have replaced the traditional ones. These newer channels of transmission undoubtedly influence the manner and the degree of transmission, without altering the fact of price interdependence among major countries.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Ahmad, Jaleel (1984) Floating Exchange Rates and World Inflation (London: Macmillan).
Argy, Victor (1982)‘Exchange Rate Management in Theory and Practice’, Princeton Studies in International Finance, no. 50 (Princeton, New Jersey: Princeton University Press), October.
BIS (1979) Forty-Ninth Annual Report (Basle: BIS) June.
Dornbusch, Rudiger and Krugman, Paul (1976) ‘Flexible Exchange Rates in the Short Run’, Brookings Papers on Economic Activity, No. 3.
Isard, Peter (1978) ‘Exchange Rate Determination: A Survey of Popular Views and Recent Models’, Princeton Studies in International Finance (Princeton, New Jersey: Princeton University Press).
Loopesko, Bonnie E. (1983) ‘Relationships among Exchange Rates, Intervention, and Interest Rates: an Empirical Investigation’, Board of Governors of the Federal Reserve System (Washington, DC: Federal Reserve).
Mayer, Helmut and Taguchi, Hiroo (1983)‘Official Intervention in the Exchange Markets: Stabilising or Destabilising’, BIS, Economic Papers No. 6 (March).
Purvis, Douglas (1979) ‘Wage Responsiveness and Insulation Properties of a Flexible Exchange Rate System’, in Lindbecker, A. (ed.), Inflation and Employment in Open Economies (Amsterdam: North-Holland).
Swoboda, Alexander (1983) ‘Exchange Rate Regimes and European-US Policy Interdependence’, IMF Staff Papers, 30, no. 1.
Tryon, Ralph W. (1983) ‘Small Empirical Models of Exchange Market Intervention: A Review of the Literature’, Board of Governors of the Federal Reserve System (Washington, DC Federal Reserve).
Turnovsky, Stephen J. (1981) ‘The Effects of Devaluation and Foreign Price Disturbances under Rational Expectations’, Journal of International Economics, 11, no. 1.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Copyright information
© 1987 International Economic Association
About this chapter
Cite this chapter
Ahmad, J. (1987). Inflationary Expectations and Price Interdependence under Floating Exchange Rates. In: Borner, S., Taylor, A. (eds) Structural Change, Economic Interdependence and World Development. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-09117-1_25
Download citation
DOI: https://doi.org/10.1007/978-1-349-09117-1_25
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-09119-5
Online ISBN: 978-1-349-09117-1
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)