Dornbusch, Rudiger (1942–2002)
Rudiger Dornbusch was one of the leading researchers in international macroeconomics in the late 20th century. He introduced the influential concept of exchange rate ‘overshooting’ to explain the excessive volatility of exchange rates after the break-up of the Bretton Woods system of fixed exchange rates in the early 1970s. Along with Stanley Fischer and Paul Samuelson, he revived the Ricardian theory of international trade whereby trade was driven by differences in technology; their simple tractable framework became similarly influential in the study of international trade.
KeywordsComparative advantage Dornbusch, R. Exchange rate dynamics Exchange rates (floating vs. fixed) Fischer, S. Hecksher-Ohlin framework New open economy macroeconomics Non-traded goods Overshooting Ricardian trade theory Samuelson, P. Sticky prices Value at risk (VAR)
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