TY  - BOOK
AU  - Calvo,Guillermo
AU  - Végh Gramont,Carlos A.
TI  - Exchange-Rate-Based Stabilization under Imperfect Credibility
T2  - IMF Working Papers; Working Paper
SN  - 1451849915 :
SN  - 1018-5941
PY  - 1991///
CY  - Washington, D.C.
PB  - International Monetary Fund
KW  - Exchange Rate
KW  - imf
KW  - Inflation Rate
KW  - Nominal Interest Rate
KW  - Real Exchange Rate
KW  - Argentina
KW  - Chile
KW  - Israel
KW  - Uruguay
N2  - This paper analyzes stabilization policy under predetermined exchange rates in a cash-in-advance, staggered-prices model. Under full credibility, a reduction in the rate of devaluation results in an immediate and permanent reduction in the inflation rate, with no effect on output or consumption. In contrast, a non-credible stabilization results in an initial expansion of output, followed by a later recession. The inflation rate of home goods remains above the rate of devaluation throughout the program, thus resulting in a sustained real exchange rate appreciation
UR  - http://elibrary.imf.org/view/IMF001/02214-9781451849912/02214-9781451849912/02214-9781451849912.xml
UR  - http://www.imfbookstore.org/IMFORG/9781451849912
ER  -