Carlos A. Végh

This rigorous and comprehensive textbook develops a basic small open economy model and shows how it can be extended to answer many important macroeconomic questions that arise in emerging markets and developing economies, particularly those regarding monetary, fiscal, and exchange rate issues. Eschewing the complex calibrated models on which the field of international finance increasingly relies, the book teaches the reader how to think in terms of simple models and grasp the fundamentals of open economy macroeconomics.

Guillermo Calvo, one of the most influential macroeconomists of the last thirty years, has made pathbreaking contributions in such areas as time-inconsistency, lack of credibility, stabilization, transition economies, debt maturity, capital flows, and financial crises. His work on macroeconomic issues relevant for developing countries has set the tone for much of the research in this area and greatly influenced practitioners' thinking in Latin America, Eastern Europe, Asia, and elsewhere.