Title:The Role of Expectations in Sudden Stops
Author(s):MERTENS, KarelDate:2007Type of Publication:Working PaperSeries/Report no.:EUI ECO; 2007/16Abstract:This paper presents a flexible-price small open economy model with a “peso problem”
in productivity states. Agents rationally adjust their beliefs about future productivity
growth after the arrival of news. A downward ...