The Mundellian trilemma and optimal monetary policy in a world of high capital mobility

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dc.contributor.authorFroyen RT
dc.contributor.authorGuender, Alfred
dc.date.accessioned2022-04-27T01:54:06Z
dc.date.available2022-04-27T01:54:06Z
dc.date.issued2021en
dc.date.updated2021-12-21T23:26:29Z
dc.description.abstractThis paper proposes that the Mundellian Trilemma remains valid despite the emergence of a world financial cycle. A clear distinction must be made between monetary policy independence and insulation of an open economy’s financial system. A flexible exchange rate allows an optimizing central bank to chart an independent course but does not insulate the domestic financial sector or broader economy from foreign monetary or financial shocks. The gains from a flexible exchange rate may be considerable and vary in accordance with the mandate of the central bank. The Mundellian Trilemma highlights the acute shortage of policy instruments and resulting tradeoffs among policy goals.en
dc.identifier.citationFroyen RT, Guender A The Mundellian trilemma and optimal monetary policy in a world of high capital mobility. SSRN Electronic Journal.en
dc.identifier.doihttp://doi.org/10.2139/ssrn.3891227
dc.identifier.issn1556-5068
dc.identifier.urihttps://hdl.handle.net/10092/103592
dc.languageen
dc.language.isoenen
dc.publisherElsevier BVen
dc.rightsAll rights reserved unless otherwise stateden
dc.rights.urihttp://hdl.handle.net/10092/17651en
dc.subjectMundellian Trilemmaen
dc.subjectpolicy independenceen
dc.subjectcapital mobilityen
dc.subjectinstrument shortageen
dc.subjectcapital controlsen
dc.subject.anzsrcFields of Research::38 - Economics::3801 - Applied economics::380107 - Financial economicsen
dc.subject.anzsrcFields of Research::38 - Economics::3801 - Applied economics::380112 - Macroeconomics (incl. monetary and fiscal theory)en
dc.subject.anzsrcFields of Research::35 - Commerce, management, tourism and services::3502 - Banking, finance and investment::350204 - Financial institutions (incl. banking)en
dc.subject.anzsrcFields of Research::35 - Commerce, management, tourism and services::3502 - Banking, finance and investment::350207 - International financeen
dc.titleThe Mundellian trilemma and optimal monetary policy in a world of high capital mobilityen
dc.typeJournal Articleen
uc.collegeService Unit
uc.departmentDepartment of Economics and Finance
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