Escaping Inflation and Regime Switches in An Open Economy
2010/04/20
研討會日期 : 2010-04-20
時間 : 14:30
主講人 : 林佑龍助理教授
地點 : C103
演講者簡介 : Yo-Long Lin got his Ph.D. in Economics from University of California, Irvine in 2009. He is currently serving as Assistant Professor of Economics at National Chi Nan University. His research interest is in monetary economics, macroeconomics, public economics, international finance and trade, and time series econometrics.
演講摘要 : How did an expansive monetary policy in one country, say the United States, spread high inflation to other countries during 1970s-80s? Two intuitions have been used to answer this question. One is from Sargent (1999), who asserts that the government's attempts to exploit a trade-off empirical Phillips curve would yield an inefficiently high inflation. The other is from Rogoff (1985), who claims that international coordinated policy between central banks can produce an excessively high inflation. This paper aims to combine these two intuitions to investigate how the international monetary policy interaction affected the transmission of inflation across countries during and after the Bretton Woods era. Our finding reveals that sudden policy regime switching from leader-follower system to non-coordination scenario makes policymakers come to realize that there exists an expectations-augmented Phillips curve embodying a version of the natural rate hypothesis. Moreover, our simulation results can explain why inflation arose again after the collapse of Bretton Woods system then decreased to a lower level in the early 1980s.
