The exchange rate and inflation in the UK

Scottish Journal of Political Economy

Volumn 50, Issue 5, 2003, Pages 585-608

  Kara, Amit ^a   Nelson, Edward ^b  

^a BANK OF ENGLAND   (United Kingdom)

^b CEPR   (United Kingdom)

Author keywords

[No Author keywords available]

Indexed keywords

EXCHANGE RATE; INFLATION; TARGETING; THEORETICAL STUDY;

EURASIA; EUROPE; UNITED KINGDOM; WESTERN EUROPE;

EID: 0347596115     PISSN: 00369292     EISSN: None     Source Type: Journal    
DOI: 10.1111/j.0036-9292.2003.05005003.x     Document Type: Article

References (56)

1. ALLSOPP, C. (2001). Economic imbalances and UK monetary policy. Bank of England Quarterly Bulletin, 41, 3, pp. 484-94.
2. AOKI, K. (2001). Optimal monetary policy responses to relative-price changes. Journal of Monetary Economics, 48, 1, pp. 55 80.
3. ARTIS, M. (1993). The role of the exchange rate in monetary policy: the experience of other countries. In A. Blundell-Wignall (ed.), The Exchange Rate, International Trade and the Balance of Payments. Ambassador Press, pp. 208 64.
4. BALL, L. (1999). Policy rules for open economies. In J. B. Taylor (ed.), Monetary Policy Rules. University of Chicago Press, pp. 127 44.
5. BANK OF ENGLAND (1994a). Inflation Report February 1994. Bank of England.
6. BANK OF ENGLAND (1994b). Inflation Report May 1994. Bank of England.
7. BATINI, N., HARRISON, R. and MILLARD, S. (2001). Monetary policy rules for an open economy. Bank of England Working Paper No. 149.
8. BATTEN, D. and OTT, M. (1983). Five common myths about floating exchange rates. Federal Reserve Bank of St. Louis Review, 65, 9, pp. 5 15.
9. BENIGNO, P. and BENIGNO, G. (2002). Implementing monetary cooperation through inflation targeting. CEPR Discussion Paper No. 3226.
10. BURSTEIN, A., EICHENBAUM, M. and REBELO, S. (2002). Why are rates of inflation so low after large devaluations? NBER Working Paper No. 8748.
11. CALVO, G. (1983). Staggered prices in a utility-maximising framework. Journal of Monetary Economics, 12, 3, pp. 383-98.
12. CAMPA, J. and GOLDBERG, L. (2002). Exchange rate pass-through into import prices: a macro or micro phenomenon? Federal Reserve Bank of New York Staff Report No. 149.
13. CLARIDA, R., GALI, J. and GERTLER, M. (2001). Optimal monetary policy in open versus closed economies: an integrated approach, American Economic Review (Papers and Proceedings). 91, 2, pp. 248-52.
14. CLARIDA, R., GALÍ, J. and GERTLER, M. (2002). A simple framework for international monetary policy analysis. Journal of Monetary Economics, 49, 5, 879-904.
15. DEBELLE, G. and WILKINSON, J. (2002). Inflation targeting and the inflation process: some lessons from an open economy, Reserve Bank of Australia Research Discussion Paper No. 2002-01.
16. DEVEREUX, M. and ENGEL, C. (2002). Exchange rate pass-through, exchange rate volatility, and exchange rate disconnect. Journal of Monetary Economics, 49, 5, pp. 913-40.
17. THE ECONOMIST (1967). Britain: will the bungle work? 25, November, pp. 868-73.
18. ENGEL, C. (1993). Real exchange rates and relative prices: an empirical investigation. Journal of Monetary Economics. 32, 1, 35-50.
19. ENGEL, C. (2002). The responsiveness of consumer prices to exchange rates and the implications for exchange-rate policy: a survey of a few recent new open-economy macro models. NBER Working Paper No. 8725.
20. ERCEG, C. (2002). The choice of an inflation target range in a small open economy. American Economic Review (Papers and Proceedings), 92, 2, 85-89.
21. ERCEG, C., HENDERSON, D. and LEVIN, A. (2000). Optimal monetary policy with staggered wage and price contracts, Journal of Monetary Economics, 46, 2, pp. 281-313.
22. FINDLAY, R. and RODRIGUEZ, C. (1977). Intermediate imports and macroeconomic policy under flexible exchange rates, Canadian Journal of Economics, 10, 2, pp. 208-17.
23. FRIEDMAN, M. (1953). The case for flexible exchange rates. In M. Friedman, Essays in Positive Economics. University of Chicago Press, pp. 157-203.
24. FRIEDMAN, M. (1967). The monetary theory and policy of Henry Simons, Journal of Law and Economics. 10, 2, pp. 1-13. Reprinted in M. Friedman, The Optimum Quantity of Money and Other Essays. Aldine, 1969, pp. 81-96.
25. GAGNON, J. and IHRIG, J. (2002). Monetary policy and exchange rate pass-through. Federal Reserve Board manuscript.
26. GALÍ, J. and GERTLER, M. (1999). Inflation dynamics: a structural econometric analysis. Journal of Monetary Economics, 44, 2, 195-222.
27. GALÍ, J. and MONACELLI, T. (2002). Monetary policy and exchange rate volatility in a small open economy. NBER Working Paper No. 8905.
28. HM TREASURY (1992). Financial Statement and Budget Report 1992-93. HMSO, March.
29. HM TREASURY (1993). Financial Statement and Budget Report 1993-94. HMSO, March.
30. HOUSE OF COMMONS (1976). Hansard. HMSO, 24 March.
31. JOHNSON, H. (1974). Major issues in monetary economics. Oxford Economic Papers. 26, 2. pp. 212-25.
32. KARA, A. and NELSON, E. (2003). The exchange rate and inflation in the UK. CEPR Discussion Paper No. 3783.
33. KING, R. and WOLMAN, A. (1999). What should the monetary authority do when prices are sticky? In J. B. Taylor (ed.), Monetary Policy Rules. University of Chicago Press, pp. 349-98.
34. KOLLMANN, R. (2001). The exchange rate in a dynamic-optimizing business cycle model with nominal rigidities: a quantitative investigation. Journal of International Economics, 55, 2, pp. 243-62.
35. LAFFER, A. and MILES, M. (1982). International Economics in an Integrated World. Scott, Foresman and Company.
36. LAMONT, N. (1992). Chancellor's mansion house speech, 29 October, reprinted in Treasury Bulletin, 3, 3, pp. 46-50.
37. LANE, P. (2001). The new open economy macroeconomics: a survey, Journal of International Economics, 54, 2, pp. 235-66.
38. McCALLUM, B. and NELSON, E. (1999). Nominal income targeting in an open-economy optimising model. Journal of Monetary Economics, 43, pp. 553-78.
39. McCALLUM, B. and NELSON, E. (2000). Monetary policy for an open economy: an alternative framework with optimising agents and sticky prices. Oxford Review of Economic Policy, 16, 4, pp. 74-91.
40. MEADE, J. (1951). The Theory of International Economic Policy. Volume 1: The Balance of Payments, Oxford University Press.
41. MEADE, J. (1978). The meaning of internal balance. Economic Journal, 88, 351, pp. 423-35.
42. MONETARY POLICY COMMITTEE (2001). Minutes of the Monetary Policy Committee meeting on 9-10 May 2001. In Monetary Policy Committee Minutes and Press Notices August 2001. Bank of England, pp. 3-7.
43. NELSON, E. (2002). Comment on 'A simple framework for international monetary policy analysis'. Journal of Monetary Economics, 49, 5, pp. 905-12.
44. NELSON, E. and NIKOLOV, K. (2002). Monetary policy and stagflation in the UK. Bank of England Working Paper No. 155.
45. OBSTFELD, M. (2002a). Inflation-targeting, exchange-rate pass-through, and volatility. American Economic Review ( Papers and Proceedings ), 92, 2, pp. 102-7.
46. OBSTFELD, M. (2002b). Exchange rates and adjustment: perspectives from the new open economy macroeconomics. NBER Working Paper No. 9118.
47. ROBERTS, J. (1995). New Keynesian economics and the Phillips curve. Journal of Money, Credit, and Banking, 27, 4, pp. 975 84.
48. ROTEMBERG, J. and WOODFORD, M. (1997). An optimization-based econometric framework for the evaluation of monetary policy. NBER Macroeconomics Annual, 12, 1, pp. 297 346.
49. SBORDONE, A. (2002). Prices and unit labour costs: a new test of price stickiness. Journal of Monetary Economics, 49, 2, pp. 265-92.
50. SIMONS, H. (1948). Economic Policy for a Free Society, University of Chicago Press.
51. SMETS, F. and WOUTERS, R. (2002). Openness, imperfect exchange rate pass-through and monetary policy. Journal of Monetary Economics, 49, 5, pp. 947-81.
52. SVENSSON, L. (2000). Open-economy inflation targeting, Journal of International Economics, 50, 1, pp. 155-83.
53. TAYLOR, J. (2000). Low inflation, pass-through, and the pricing power of firms. European Economic Review, 44, 7, pp. 1389 408.
54. VARIAN, H. (1992). Microeconomic Analysis (3rd edition. WW Norton.
55. WILSON, T. (1976). Effective devaluation and inflation. Oxford Economic Papers. 28, 1, pp. 1 24.
56. WOODFORD, M. (2003). Interest and Prices: Foundations of a Theory of Monetary Policy, Princeton University Press.