This paper addresses the consumption-real exchange rate anomaly. International real business cycle models based on complete financial markets predict a unitary correlation between the real exchange rate and the ratio of home to foreign consumption when subjected to supply-side shocks. In the...

A two-country, optimising, sticky price model of real exchange rate determination in the new open macroeconomics tradition is developed, allowing several different forms of deviation from purchasing power parity (PPP), both along the adjustment path and in the steady state. The model has a rich...

In this paper we first compare house price cycles in advanced and emerging economies using a new quarterly house price data set covering the period 1990-2012. We find that house prices in emerging economies grow faster, are more volatile, less persistent and less synchronised across countries...