Prêmio de risco endógeno, metas de inflação e câmbio flexível : implicaçôes dinâmicas da hipótese Bresser-Nakano para uma pequena economia aberta
By: OREIRO, José Luís
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ArticlePublisher: São Paulo : Editora 34, jul./set. 2002Revista de Economia Política = Brazilian Journal of Political Economy 22, 3 , p. 107Abstract: The objective of this article is to analyze the implicatications of Bresser-Nakano hypothesis, that risk-premium is positive related to domestic rate of interest, over time paths of nominal interest rate and nominal exchange rate in a small open economy whose regime of economic policy is characterized by flexible exchange rate, inflation trargeting and short run capital mobiliy. In the theoretical framework developed in the article, we are able to shown that, in the case of a strong positive feedback of nominal interest rate over risk-premium, (i) there are multiple time paths of nominal interest rate and nominal exchange rate; (ii) all such paths are compatible with some degree of price stability and (iii) some of these paths, however, are related to an increase in current account deficit and/or a continuous increase in fiscal deficit. The logical conclusion of these results is that the achievement of current account and fiscal equilibrium can only be obteained by a change in the regime of economic policy
The objective of this article is to analyze the implicatications of Bresser-Nakano hypothesis, that risk-premium is positive related to domestic rate of interest, over time paths of nominal interest rate and nominal exchange rate in a small open economy whose regime of economic policy is characterized by flexible exchange rate, inflation trargeting and short run capital mobiliy. In the theoretical framework developed in the article, we are able to shown that, in the case of a strong positive feedback of nominal interest rate over risk-premium, (i) there are multiple time paths of nominal interest rate and nominal exchange rate; (ii) all such paths are compatible with some degree of price stability and (iii) some of these paths, however, are related to an increase in current account deficit and/or a continuous increase in fiscal deficit. The logical conclusion of these results is that the achievement of current account and fiscal equilibrium can only be obteained by a change in the regime of economic policy
v. 22, n. 3(87)
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