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'Fiscal policy, productivity shocks and the real exchange rate'.

Event details of Economics Colloquia: Gernot Müller (Goethe University Frankfurt)
Date 29 November 2007
Time 11:00 -12:00
Location Roeterseilandcampus - building E

Fiscal policy, productivity shocks and the real exchange rate
Gernot Müller (Goethe University Frankfurt)

The real exchange rate is a key variable in the international transmission mechanism. We provide new evidence on its response to government spending and technology shocks by estimating a VAR model for the US, Japan and the euro area. To achieve identification, we derive robust restrictions on the sign of several impulse responses from a two country general equilibrium business cycle model. We find that in response to both spending and technology shocks, the real exchange rate-whose response is left unrestricted-appreciates significantly in two out of three countries.

For more information please contact Dr. M. Anufriev

Roeterseilandcampus - building E

Roetersstraat 11
1018 WB Amsterdam