Raw materials world price changes and exchange rates in a small open economy

2007 ◽  
Vol 95 (1) ◽  
pp. 132-139 ◽  
Author(s):  
Juan A. Garcia-Cebro ◽  
Ramon Varela-Santamaria
Keyword(s):  
Exchange Rates ◽  
Open Economy ◽  
Raw Materials ◽  
Small Open Economy ◽  
Price Changes ◽  
World Price

Exchange rates and import prices for a small open economy: the case of Ireland

1998 ◽  
Vol 30 (9) ◽  
pp. 1147-1155 ◽  
Author(s):  
Geoff Kenny ◽  
Donal Mcgettigan
Keyword(s):  
Exchange Rates ◽  
Open Economy ◽  
Small Open Economy ◽  
Import Prices

scholarly journals On the bifurcation of a torus in a small open economy model

2011 ◽  
Vol 48 (1) ◽  
pp. 125-134
Author(s):  
Katarína Makovínyiová ◽  
Rudolf Zimka
Keyword(s):  
Interest Rate ◽  
Exchange Rates ◽  
Open Economy ◽  
Invariant Torus ◽  
Small Open Economy ◽  
Sufficient Conditions ◽  
National Income ◽  
Macroeconomic Model ◽  
Money Stock ◽  
Economy Model

Abstract A four-dimensional macroeconomic model of a small open economy under fixed exchange rates is investigated. The model describes the development of national income, capital stock, interest rate and money stock. Sufficient conditions for the existence of an invariant torus are given. A numerical example illustrating the gained results is presented.

On the bifurcation of limit cycles in a dynamic model of a small open economy

2013 ◽  
Vol 24 (3) ◽  
pp. 455-470 ◽  
Author(s):  
KATARÍNA MAKOVÍNYIOVÁ ◽  
RUDOLF ZIMKA
Keyword(s):  
Interest Rate ◽  
Exchange Rates ◽  
Open Economy ◽  
Limit Cycles ◽  
Capital Stock ◽  
Small Open Economy ◽  
Sufficient Conditions ◽  
Macroeconomic Model ◽  
Money Stock ◽  
Bifurcation Of Limit Cycles

In this paper a four-dimensional macroeconomic model of a small open economy, describing the development of income, capital stock, interest rate and money stock, which was constructed in [5] (Makovínyiová, K. & Zimka, R. (2009) On stability in generalized Schinasi's macroeconomic model under fixed exchange rates. Tatra Mt. Math. Publ. 43, 115–122), is analysed. Sufficient conditions for the existence of one pair of purely imaginary eigenvalues and two eigenvalues with negative real parts in the linear approximation matrix of the model are found. Formulae for the calculation of the bifurcation coefficients of the model are derived. A statement about the existence of limit cycles is made. A numerical example is given illustrating the results.

scholarly journals A nonlinear macrodynamic model with fixed exchange rates: Its dynamics and noise effects

2000 ◽  
Vol 4 (4) ◽  
pp. 319-331 ◽  
Author(s):  
Toichiro Asada ◽  
Toichio Inaba ◽  
Tetsuya Misawa
Keyword(s):  
Exchange Rates ◽  
Open Economy ◽  
Chaotic Dynamics ◽  
Small Open Economy ◽  
Three Dimensional ◽  
Basic Structure ◽  
Stochastic Disturbances ◽  
Noise Effects ◽  
Fixed Exchange Rates ◽  
Linear Approximation Method

In this paper, we formulate a discrete time version of the Kaldorian macrodynamic model in a small open economy with fixed exchange rates. The model is described by a system of the three-dimensional nonlinear difference equations with and without stochastic disturbances (noise effects). We study the local stability/instability properties analytically by using the linear approximation method, and chaotic dynamics with and without noise effects are investigated by means of numerical simulations. In general, it is believed that the effect of the noise is to obscure the basic structure of the system. But, this is not necessarily the case. We show by means of numerical analysis that the noise can reveal the hidden structure of the model contrary to the usual intuition in some situations.

ASYMMETRIC RESPONSE OF DISAGGREGATED IMPORT DEMAND TO EXCHANGE RATE MOVEMENTS: A SMALL OPEN ECONOMY PERSPECTIVE

2020 ◽  
pp. 1-18
Author(s):  
KHURRUM S. MUGHAL ◽  
SADDAM ILYAS ◽  
YASIR TARIQ MOHMAND ◽  
FAHEEM ASLAM ◽  
MUKHTAR-UL- HASAN
Keyword(s):  
Exchange Rate ◽  
Open Economy ◽  
Consumer Goods ◽  
Raw Materials ◽  
Small Open Economy ◽  
Import Demand ◽  
Policy Implications ◽  
Empirical Literature ◽  
Capital Goods ◽  
Exchange Rate Movements

Net importing countries are very susceptible to changes in the value of their currency. Pakistan, being a small open economy, faces a constant pressure in its current account and BOP, which leads to unavoidable stress on its exchange rate. Exchange rate movements affect the cost of imports directly which have been studied extensively in empirical literature. However, these studies ignore the possibility of asymmetric effects of exchange rate and its impact on import demand in Pakistan. An appreciation in exchange rate may have a different impact on demand for imports than depreciations depending upon the level of rigidity in consumer preferences as well as the availability of substitutes for consumer goods, capital goods and raw materials. We use quarterly data of Pakistan’s consumer goods, capital goods and raw material imports from 2005:Q1 to 2018:Q4 and employ a relatively recent econometric methodology, namely, Nonlinear Autoregressive Distributed Lag (NARDL) technique. The results confirm the existence of asymmetric impact of exchange rate in the long-run. The appreciation of currency has more pronounced impact in increasing imports relative to the depreciation of it in decreasing imports. There are further differences of this effect within imports across consumer goods, capital goods and raw materials. We present policy implications of this asymmetric effect of exchange rate on disaggregated consumer imports.

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