The model retains the uncomfortable property that any incre… - Rudi Dornbusch

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The model retains the uncomfortable property that any increase in demand for home output ... leads to nominal and real appreciation... The uncomfortable fact remains that even in this model there is a short-run tendency for an expenditure increase to induce an appreciation... Expansionary fiscal policy will lead to an initial depreciation of the nominal and real exchange rate if ... (it) is accommodated by an expansion in nominal money.

Rudi Dornbusch

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About Rudi Dornbusch

Rüdiger "Rudi" Dornbusch (June 8, 1942 – July 25, 2002) was a German economist, who worked for most of his career in the United States.

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Alternative Names: Rudiger W. Dornbusch • Rudiger Dornbusch

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James Meade James Tobin Lawrence Klein John Maynard Keynes Peter Schiff

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Italians dream that the ECB (European Central Bank) will make their life easier than the Bundesbank does now... The new central bank is certain to establish itself at the outset as a direct continuation of the German central bank.

The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.

The most serious criticism of EMU is that by abandoning exchange rate adjustments it transfers to the labor market the task of adjusting for competitiveness and relative prices... losses in output and employment (and pressure on the European central bank to inflate) will predominate.

The model retains the uncomfortable property that any increase in demand for home output ... leads to nominal and real appreciation... The uncomforta… - Rudi Dornbusch

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