Article ID Journal Published Year Pages File Type
5054857 Economic Modelling 2013 11 Pages PDF
Abstract
► Derive the boundary of determinacy in a small open economy DSGE model. ► Find that the macroeconomic system in China is under indeterminacy. ► Indeterminacy stems from sunspot shock and propagation of fundamental shocks. ► The PBC includes the RMB exchange rate in its monetary policy rule. ► Monetary policy shock affects real economy in the short run, not in the long run.
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Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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Estimating a small open economy DSGE model with indeterminacy: Evidence from China
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