Title page for etd-0716108-200854


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URN etd-0716108-200854
Author Kuan-Jen Chen
Author's Email Address m956040002@student.nsysu.edu.tw
Statistics This thesis had been viewed 5348 times. Download 2298 times.
Department Economics
Year 2007
Semester 2
Degree Master
Type of Document
Language zh-TW.Big5 Chinese
Title Monetary Policy and Belief-driven Fluctuation in a Small Open Economy
Date of Defense 2008-05-27
Page Count 72
Keyword
  • money in the production function
  • small open economy
  • belief-driven fluctuation
  • endogenous growth
  • indeterminacy
  • money growth rate targeting
  • inflation targeting
  • sunspots
  • Abstract This thesis analyzes the connection between monetary policies and belief-driven fluctuation, and discusses the effects of monetary policies in a small open economy. We construct an endogenous growth model that introduces the role of money into the production function and allows elastic labor supply. In departing from the findings proposed by Benhabib and Farmer (1994), we find that belief-driven fluctuation can be easily encouraged, as long as there is lower increasing return to scale under money growth rate targeting. However, if there is a higher level of increasing return to scale, the increase of the growth rate of nominal money supply will only increase the economic growth rate temporarily, and money is super-neutral in the long run. More importantly, we show that under inflation rate targeting, the central bank will eliminate possibilities of belief-driven fluctuation in the small open economy, but lose the efficacy of monetary policy on the short-term economic growth at the same time.
    Advisory Committee
  • Ming-Jang Weng - chair
  • Ming-Fu Shaw - co-chair
  • Shul-John Li - advisor
  • Ching-Chong Lai - advisor
  • Files
  • etd-0716108-200854.pdf
  • indicate access worldwide
    Date of Submission 2008-07-16

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