Ripoll, Marla - In: The Journal of International Trade & Economic Development 14 (2005) 2, pp. 167-196
This paper uses a two-sector general equilibrium model to analyse both steady-state and stochastic dynamic effects of two real exchange rate targeting policies: a constant-target, and a band-target rule. In the model, targeting is implemented by imposing a stochastic fully-rebatable tax on the...