Currency Wars: The Only Thing We Have To Fear Is Fear Itself

Barry Eichengreen and Paul Krugman take down the Currency War Mirage

 Use the Large Open Economy Mundell Fleming Model to show how Currency Wars

a) may have no effect on either country in terms of competitiveness

b) show how two countries – (and hence the world) might benefit from a currency war and give the conditions under which this must be true.  

Leave a Reply

Your email address will not be published.