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Loanable funds in the open economy -- see how external interest rates, domestic savings and investment, and the real exchange rate are jointly determined.
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This is Part I of the video treatment of the open economy loanable funds model.
It is a review of the theory, and it shows how net exports, the saving / investment balance, and the real exchange rate are jointly determined -- all in one model.
Click on the icon below to download the spreadsheet-based workshop!!
This is Part II of the video treatment of the open economy loanable funds model.
It features three spreadsheet based applications:
Impacts of higher US interest rates on emerging market real exchange rates – the “Taper Tantrum.”
A fiscal expansion in an economy considered to be ‘sound’ by global investors.
A fiscal expansion in an economy not considered to be ‘sound’ by global investors.
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