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Professor Rdseth provides a broad survey of open economy macroeconomics within a unified framework. This upperlevel book reviews the theories employed by ministries of finance, central banks and financial institutions that form the basis for most quantitative models of open economies. It also points out the limitations of these theories and gives an update on recent research. The emphasis is on how the nature of the markets for foreign exchange and for exports and imports sets the stage for government policy and determines the macroeconomic effects of external and internal shocks.
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