RDP 2009-01: Currency Misalignments and Optimal Monetary Policy: A Re-examination
Equation
y
˜
t
R
=
ν
(
2
−
ν
)
(
s
t
−
(
a
t
−
a
t
∗
)
)
−
(
ν
−
1
)
π
t
R
y
˜
t
=
1
2
(
y
˜
t
W
+
y
˜
t
R
)
y
˜
t
∗
=
1
2
(
y
˜
t
W
−
y
˜
t
R
)
Δ
t
=
−
ξ
σ
π
t
R
−
(
ν
−
1
)
(
s
t
−
(
a
t
−
a
t
∗
)
)
π
H
t
=
1
2
(
π
t
W
+
π
t
R
)
−
(
2
−
ν
2
)
(
s
t
−
s
t
−
1
)
π
F
t
=
1
2
(
π
t
W
+
π
t
R
)
+
ν
2
(
s
t
−
s
t
−
1
)
π
F
t
∗
=
1
2
(
π
t
W
+
π
t
R
)
+
(
2
−
ν
2
)
(
s
t
−
s
t
−
1
)
π
H
t
∗
=
1
2
(
π
t
W
−
π
t
R
)
−
ν
2
(
s
t
−
s
t
−
1
)
MathType@MTEF@5@5@+=feaagCart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLnhiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=xfr=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@08B7@