The International Diversification Puzzle when Goods Prices are Sticky.
This paper develops a two-country monetary DSGE model in which households choose a portfolio of home and foreign equities, and a forward position in foreign exchange. Some nominal goods prices are sticky. Trade in these assets achieves the same allocations as trade in a complete set of nominal state...
Saved in:
| Online Access: |
Full Text (via ProQuest) |
|---|---|
| Main Author: | |
| Other Authors: | |
| Format: | eBook |
| Language: | English |
| Published: |
Washington :
International Monetary Fund,
2009.
|
| Series: | IMF working paper (Online)
|