exchange-rate regimes

Feature image for “Policy Ineffectiveness in Open Economy Models,” showing a 2×2 matrix where fiscal policy is strong under fixed exchange rates but fails under floating rates, while monetary policy fails under fixed rates but is strong under floating rates.

Macroeconomic Trends and Analysis

Policy Ineffectiveness Open Economy: Channels and Regimes

Policy ineffectiveness in open economy models means a correct policy moves no output: monetary policy fails under a peg, fiscal...

June 2, 2026

Feature image for “Capital Mobility in Open Economy Macroeconomics,” showing how perfect, imperfect, and zero capital mobility change the slope of the BP curve in the Mundell-Fleming framework.

Macroeconomic Trends and Analysis

Capital Mobility Open Economy: BP Curve and Policy

Capital mobility in an open economy sets the slope of the BP curve, which decides whether fiscal or monetary policy...

June 2, 2026