Welfare and Monetary Policy under a Dollar Standard
碩士 === 國立政治大學 === 經濟學系 === 98 === The U.S. dollars in the world possess a unique position; the majority of the international tradable goods are priced in the U.S. dollars. This paper sets up a two-country DSGE model where the U.S. dollar serves as the reference currency to quantitatively examine the...
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| Format: | Others |
| Language: | zh-TW |
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2010
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| Online Access: | http://ndltd.ncl.edu.tw/handle/56452203083282714716 |
| Summary: | 碩士 === 國立政治大學 === 經濟學系 === 98 === The U.S. dollars in the world possess a unique position; the majority of the international tradable goods are priced in the U.S. dollars. This paper sets up a two-country DSGE model where the U.S. dollar serves as the reference currency to quantitatively examine the impacts caused by the monetary shocks, as well as how both governments should adopt their monetary policies when facing external shocks. The results show that there are positive impacts on both countries' outputs when a monetary shock occurs in the reference-currency-holding country; Conversely, there is a beggar-thy-neighbor effect when the shock takes place in the other country. In general, the inflation-targeting interest rate rule leads to greater welfare in both countries.
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