The Open Economy Macromodel: Interactions between Theoretical Developments and Real-World Behavior

  • Marina v. N. Whitman
  • M. June Flanders


The development of the open-economy macro-model over the past half century can be viewed as a running, and still uncompleted, saga of the interaction between advances in economic theory and developments in the practitioners’ world where economic policies are formulated and international economic transactions take place. As Maurice Obstfeld, one of the major contributors to, as well as the leading synthesizer of these developments in macro-theory, notes: “Frequently, prominent international policy problems, even crises, provide the inspiration for new [theoretical] explanations ” (Obstfeld 2000b, 1).


Exchange Rate Monetary Policy Current Account Real Exchange Rate European Monetary Union 
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Copyright information

© Springer Science+Business Media New York 2002

Authors and Affiliations

  • Marina v. N. Whitman
    • 1
  • M. June Flanders
    • 2
  1. 1.Gerald R. Ford School of Public PolicyUniversity of MichiganAnn ArborUSA
  2. 2.Tel-Aviv UniversityIsrael

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