52.MUNDELL-FLEMING MODEL | FLEXIBLE EXCHANGE RATE REGIME |Macroeconomics Detailed discussion [Part1]
Автор: ECONOMICS PEDIA
Загружено: 2020-10-11
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#mundellfleming #flexibleexchangerate #macroeconomics #openeconomy
The Mundell-Fleming Model (MFM) describes the workings of a small economy open to international trade in goods and financial assets, and provides a framework for monetary and fiscal policy analysis. The basic framework is a static, non-microfounded model extending the Keynesian IS-LM model. Indeed, the MFM shares with the IS-LM model the philosophical and methodological approach, and the basic features: the model is linear and the main assumption is that consumer prices are fixed. As a matter of fact, the MFM nests the IS-LM model as a special case, for a particular parameterisation.
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