H. Visser

Exchange rate theories

SummaryA four-period classification is used to categorise recent exchange-rate theories or models. In the very short period, only capital flows are relevant. In the short period, both capital flows and payments on the current account play a role. In the long period, the capital account and the current account are individually in equilibrium. In the very long period, purchasing power parity holds. Cash-in-advance models are dealt with separately. Many models that purport to explain exchange rates do in fact not provide for the exchange of currencies. No model stands up satisfactorily to econometric testing. Speculative bubbles, the ‘peso problem’ and ‘news’ play havoc with tests of the uncovered interest parity theorem, the core of the monetary models. This aside, the fundamental assumption of rational expectations itself is suspect. There does not seem to be such a thing as a ‘true’ model.

Geisst, Charles R.: Beggar thy neighbor. A history of usury and debt

An excellent history of attempts by worldly authorities and the clergy since the times of the Roman empire to curb or ban the practice of charging interest on loans. Geisst has a sharp eye for power struggles and the play of interest groups. Concentrates for the19th and 20th centuries on the US and the UK. A joy to read.

Beggar Thy Neigbor. A History of Usury and Debt [Review of: C.R. Geist (2013) Beggar Thy Neigbor; A History of Usury and Debt]

An excellent history of attempts by worldly authorities and the clergy since the times of the Roman empire to curb or ban the practice of charging interest on loans. Geisst has a sharp eye for power struggles and the play of interest groups. Concentrates for the19th and 20th centuries on the US and the UK. A joy to read.

Geisst, Charles R.: Beggar thy neighbor. A history of usury and debt: 400 pp. University of Pennsylvania Press, Philadelphia, 2013. Cloth,

An excellent history of attempts by worldly authorities and the clergy since the times of the Roman empire to curb or ban the practice of charging interest on loans. Geisst has a sharp eye for power struggles and the play of interest groups. Concentrates for the19th and 20th centuries on the US and the UK. A joy to read.

39.95

The past decade has witnessed a surge in interest in the area of financial globalization and economic performance. This was stimulated by the 1997–1998 Asian financial crisis after plans to adopt full capital account liberalization by IMF member states failed. Scholars have since focused on the dangers that may result from foreign-exchange crises and increased market volatility. This essential volume brings together the seminal contributions to this important field and will be of great value to lectures and students, as well as politicians and officials involved in international economic policy making.

Financial Globalization and Economic Performance

While in the literature concerning the Asian crisis extensive coverage has been given to the course of events in the countries implementing IMF-supported programmes, scant attention has been paid to other countries that also suffered from the crisis. Potential alternatives to the IMF way of handling the crisis are thus in danger of being neglected.

The Asian crisis, the IMF and Dr Mahathir

For governments there is no getting around the need to follow an exchangerate policy. First, a decision has to be made on which system to adopt: a fixed-rate (for all practical purposes a fixed-but-adjustable peg) system, a fully-floating rate system, or something in between, such as a predetermined crawling peg or tablita system. Second, in a fixed-rate system some level of the exchange rate must be chosen and in a floating-rate system a choice must be made between fully free-floating and ‘dirty’ floating. The choice depends on a government’s policy aims and on the economic environment.

The Exchange Rate as an Export-Stimulation Mechanism

SummaryIn this article an amended vesion of the traditionalIS/LM-model for an open economy is developed. TheLM-curve is replace by anFM-curve, which represents equilibrium between the demand for and supply of money and bonds. The banks passively satisfy the wishes of the public as to the composition of its portfolio of money and bonds, creating or destroying money in the process. It turns out that not much is left of the well-orderedIS/LM world.

Monetary policy in an open economy with private debt: Another variation on theIS/LM theme

SummaryFollowing the examples of Hicks and Modigliani, most economists treat neoclassical and Keynesian theories as special cases of a more general model. In the opinion of Clower, Leijonhufvud and Shackle, Keynes differs from the neoclassics in assuming incomplete information. An analysis of non-tâtonnement pricing shows that the positive correlation between unemployment and real wage rates, still adhered to by Keynes, need not exist. With non-tâtonnement pricing and an-product economy, idleness of capital goods can be explained. The macro-economic production function, implying as it does a one-product, one-producer economy, is misleading.