This note examines the role of stock price stabilization in a small open new Keynesian model. We show that stabilizing stock prices is desirable to attain a unique rational expectations equilibrium and that the open economy effect has a significant impact on the determinacy condition.

This research has examined the impact of business freedom on environmental degradation in developed and developing countries from 2000 to 2022. Panel least squares and generalized method of moments have been applied for empirical analysis. Our findings show that both business freedom and...

Smooth and stable commercial/business activities are the prime concern of every nation, as these activities decide the developmental routes of the economy. This study has examined the role of institutional development and policy mix in determining business freedom in developing countries....

China was extremely successful in recent decades in managing external equilibrium in the short and medium term using three mechanisms to cushion the balance of payments shocks. First, it maintained a flexible rate, so could adjust to the fluctuations in trade balance and capital flows via...

Geoeconomic fragmentation—the phenomenon of international transactions being increasingly restricted to politically aligned partners—creates risks for individual countries but also opportunities that some hope to seize by becoming “connector” countries. We formalize the concept of...

The objective of this paper is to analyze the macroeconomic effects of media coverage related to the trade conflict between China and the U.S. for selected countries of the European Union. Our main aim is to evaluate whether media coverage constitutes a relevant transmission channel for...

This paper presents a two-country model linking Poland and the euro area and applies it for assessment of heterogeneity across these two regions. Overall, our results can be seen as rather inconclusive about the differences in parameters describing agents' decision-making in Poland and in the...

Background: SAFTA aims to encourage and create a joint agreement among the countries, which includes medium and long term agreements. SAFTA increased the local economic incorporation by advertising the favoured trade between SAARC countries. The association of Afghan with SAARC member countries...

Background: SAFTA aims to encourage and create a joint agreement among the countries, which includes medium and long term agreements. SAFTA increased the local economic incorporation by advertising the favoured trade between SAARC countries. The association of Afghan with SAARC member countries...

The literature on the impact of exchange rate volatility on foreign trade is based on two different views. The first view suggests that volatility will reduce foreign trade through real and financial risk factors. The opposite hypothesis is that trade volume and flows will determine exchange...