The Role of Private Financial Wealth in a Portfolio Model

A Study of the Effects of Fiscal Deficits on the Real Exchange Rate

• Author(s): A. Calderon-Madrid,
• Publisher: Springer
• Pages: 126
• ISBN_10: 0230375545
  ISBN_13: 9780230375543
  
• Language: en
• Categories: Business & Economics / Economics / Macroeconomics , Political Science / Political Economy , Business & Economics / Economics / General , Political Science / Public Policy / Economic Policy ,

Description:... This book considers the implications for the dynamics of the exchange rate and private financial wealth. In a model in which fiscal imbalances are allowed to change the level of domestic public indebtedness. The analysis raises the possibility of an initial appreciation followed by a depreciation and a final exchange rate appreciation. It also highlights the importance that adjustments in the stock of privately-held financial assets have for the determination and speed of medium-run effects of shocks to the economy.