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The asset market view on flexible exchange rates: A critical comment

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  • Tivig, Thusnelda

Abstract

The more recent asset market literature on flexible exchange rates seems to share the opinion that it is not possible to treat the stock-flow interaction on the adjustment path to a new long-run equilibrium adequately in continuous time. The present paper discloses some severe inconsistencies between the verbal and formal formulation of the asset market ap-proach (AMA) that are linked to this proposition and argues that the AMA has not reached its target yet. A possible Solution is outlined.

Suggested Citation

  • Tivig, Thusnelda, 1987. "The asset market view on flexible exchange rates: A critical comment," Discussion Papers, Series II 18, University of Konstanz, Collaborative Research Centre (SFB) 178 "Internationalization of the Economy".
    • Handle: RePEc:zbw:kondp2:18
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