Monetary and exchange rate policies could transform global economies
The "New open economy macroeconomics" (NOEM) is a new way of looking at how policies affect open economies. It improves upon older models by considering factors like imperfect competition and rigid prices. NOEM helps us understand how changes in money and exchange rates impact the economy, and how to design better policies to stabilize it. It also shows that international cooperation in policy-making can be important for optimal outcomes.