RDP 9101: The Effect of Steady Inflation on Interest Rates and the Real Exchange Rate in a World with Free Capital Flows
Equation (3)
y
=
−
γ
(
i
[
1
−
τ
]
−
Dp
)
+
δ
(
e
−
p
)
;
γ
,
δ
>
0
(
IS
curve
)
MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaqbaeaabeGaaa qaaiaabMhacqGH9aqpiiaacqWFsislcqaHZoWzdaqadaqaaiaabMga daWadaqaaiaaigdacqWFsislcqaHepaDaiaawUfacaGLDbaacqWFsi slcaqGebGaaeiCaaGaayjkaiaawMcaaiabgUcaRiabes7aKnaabmaa baGaaeyzaiab=jHiTiaabchaaiaawIcacaGLPaaacaGG7aaabaGaeq 4SdCMaaiilaiabes7aKjabg6da+iaaicdaaaWaaeWaaeaacaqGjbGa ae4uaiaaykW7caqGJbGaaeyDaiaabkhacaqG2bGaaeyzaaGaayjkai aawMcaaaaa@5BC0@