All Questions
4 questions
0
votes
1
answer
128
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Log-linearization of real exchange rate
I have a doubt on how to log linearize an expression for the real exchange rate. I have read in several papers that they express it using substitutions. I haven't been able to find out what ...
- 343
0
votes
1
answer
493
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Log-linear version of the uncovered interest rate parity
I am trying to derive the log-linear version of the uncovered interest rate parity under complete asset markets.
I know that the UIP condition is given by
$$(1+i_t)=(1+i^*_t)\frac{S_{t+1}}{S_t}$$
I ...
- 343
2
votes
0
answers
324
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Transversality Condition
I am reading the first section of chapter 10 of the Obstfeld and Rogoff textbook Foundations of International Economics and I have a doubt in how the transversality condition is obtained. Even though ...
- 343
1
vote
1
answer
171
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When to use a lagrange multiplier?
I have a question in regards to the use of Lagrange multipliers in macro models.
I have seen that when writing a Lagrange there are two ways to write the Lagrange multiplier: 1) Indexed or 2) ...
- 343