Chapter

Appendix I Results of Standard Simulations

Author(s):
International Monetary Fund
Published Date:
July 1990
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Table 11.Increase of Japanese Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Japan
Real GNP3.21.4−0.3−1.6−2.3−2.4
Real domestic demand5.03.21.60.3−0.6−1.0
GNP deflator0.71.82.93.53.63.2
Short-term interest rate (percent)0.20.81.62.12.11.7
Long-term interest rate (percent)1.41.71.71.40.90.3
Nominal effective exchange rate8.58.47.86.44.52.6
Current account balance1−0.9−0.8−0.7−0.7−0.5−0.4
General government financial balance1−3.0−2.8−2.6−2.2−1.8−1.3
Gross private investment1−1.4−2.4−3.3−3.7−3.8−3.6
United States
Real GNP0.10.0−0.1−0.1−0.1−0.0
GNP deflator0.00.10.20.20.10.1
Short-term interest rate (percent)0.10.20.30.20.20.1
Nominal effective exchange rate (percent)−1.4−1.5−1.4−1.2−0.9−0.6
Current account balance10.10.10.10.10.10.1
Germany, Fed. Rep. of
Real GNP0.20.0−0.00.00.10.1
GNP deflator0.10.10.20.10.1−0.0
Short-term interest rate (percent)0.10.20.20.20.10.0
Nominal effective exchange rate (percent)−1.0−1.0−0.9−0.8−0.7−0.5
Current account balance10.20.10.10.20.20.1
United Kingdom
Real GNP0.0−0.1−0.1−0.10.00.1
GNP deflator0.10.10.10.0−0.1−0.1
Short-term interest rate (percent)0.10.20.20.20.1−0.0
Nominal effective exchange rate (percent)−1.2−1.2−1.1−1.0−0.7−0.5
Current account balance10.00.0−0.0−0.0−0.0−0.0
France
Real GNP0.1−0.0−0.0−0.1−0.0−0.0
GNP deflator0.00.10.10.0−0.0−0.1
Short-term interest rate (percent)0.10.10.10.10.10.0
Nominal effective exchange rate (percent)−1.1−1.0−0.9−0.7−0.5−0.2
Current account balance10.10.10.10.10.10.1
Italy
Real GNP0.2−0.0−0.1−0.1−0.1−0.1
GNP deflator0.00.10.0−0.0−0.1−0.2
Short-term interest rate (percent)0.10.10.10.10.10.0
Nominal effective exchange rate (percent)−1.1−1.1−1.0−0.7−0.5−0.2
Current account balance10.10.10.10.00.00.0
Canada
Real GNP0.20.1−0.0−0.1−0.1−0.1
GNP deflator0.10.10.20.20.20.2
Short-term interest rate (percent)0.10.20.20.20.10.1
Nominal effective exchange rate (percent)−0.5−0.5−0.5−0.4−0.2−0.1
Current account balance10.20.10.10.10.10.1
Smaller industrial countries
Real GNP0.30.20.10.0−0.0−0.1
GNP deflator0.10.20.30.30.30.2
Short-term interest rate (percent)0.10.10.10.10.10.0
Nominal effective exchange rate (percent)−1.3−1.2−1.1−0.8−0.5−0.3
Current account balance10.20.20.20.20.20.1
Capital exporting developing countries
Real GDP0.30.1−0.2−0.3−0.4−0.3
Other developing countries
Real GDP (percent)0.10.0−0.0−0.1−0.1−0.1
GNP deflator (percent)0.91.11.21.11.00.7
Real imports (percent)0.9−0.2−0.7−0.9−0.9−0.8
Interest payments2−0.3−0.10.10.30.30.2
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil1.11.31.41.41.10.8
Price index of commodities2.32.72.82.62.31.8

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 12.Increase of 10 Percent in the Japanese Money Supply Target(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Japan
Real GNP4.34.63.11.0–0.9–1.9
Real domestic demand3.43.82.81.3–0.2–1.1
GNP deflator1.23.66.59.110.911.7
Short–term interest rate (percent)–3.3–4.0–2.7–0.51.42.4
Long–term interest rate (percent)–1.8–0.70.61.51.81.5
Nominal effective exchange rate–13.0–10.2–6.7–4.2–3.5–4.6
Current account balance10.00.20.1–0.0–0.1–0.1
General government financial balance10.00.1–0.2–0.6–0.8–0.8
Gross private investment14.73.51.5–0.3–1.4–1.7
United States
Real GNP–0.0–0.2–0.2–0.2–0.2–0.1
GNP deflator0.00.10.10.20.10.1
Short–term interest rate (percent)–0.1–0.1–0.00.10.20.2
Nominal effective exchange rate (percent)2.92.31.61.00.91.1
Current account balance10.1–0.0–0.1–0.1–0.0–0.0
Germany, Fed. Rep. of
Real GNP–0.1–0.2–0.3–0.2–0.10.0
GNP deflator0.10.20.20.20.1–0.0
Short–term interest rate (percent)–0.1–0.00.10.20.20.1
Nominal effective exchange rate (percent)1.81.51.00.60.40.5
Current account balance10.10.0–0.0–0.00.00.1
United Kingdom
Real GNP0.2–0.1–0.3–0.3–0.3–0.1
GNP deflator0.10.20.30.30.20.0
Short–term interest rate (percent)–0.1–0.00.10.20.20.1
Nominal effective exchange rate (percent)2.01.61.00.60.40.5
Current account balance10.30.10.0–0.0–0.1–0.1
France
Real GNP0.1–0.0–0.1–0.2–0.1–0.0
GNP deflator0.00.10.10.1–0.0–0.1
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)1.51.10.70.40.40.6
Current account balance10.10.1–0.0–0.0–0.0–0.0
Italy
Real GNP0.00.0–0.1–0.1–0.1–0.1
GNP deflator0.00.10.10.10.0–0.1
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)1.61.20.10.40.40.6
Current account balance10.10.10.0–0.0–0.0–0.0
Canada
Real GNP–0.0–0.1–0.1–0.1–0.1–0.1
GNP deflator–0.00.10.10.10.10.0
Short–term interest rate (percent)–0.1–0.00.00.10.10.1
Nominal effective exchange rate (percent)1.00.80.50.30.20.3
Current account balance10.00.0–0.0–0.0–0.0–0.0
Smaller industrial countries
Real GNP–0.1–0.1–0.1–0.1–0.1–0.0
GNP deflator0.00.10.20.20.10.0
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)1.81.30.80.40.40.6
Current account balance10.10.00.00.00.00.0
Capital exporting developing countries
Real GDP0.60.50.2–0.1–0.2–0.3
Other developing countries
Real GDP (percent)0.10.10.1–0.0–0.1–0.1
GNP deflator (percent)–1.2–0.60.00.50.70.6
Real imports (percent)1.41.00.2–0.5–0.7–0.7
Interest payments20.1–0.1–0.10.00.20.2
Current account balance1–0.0–0.0–0.00.00.00.0
World prices (in dollars)
Price of oil–1.7–0.90.00.70.90.9
Price index of commodities–1.3–1.5–0.90.10.91.4

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 13.Increase of German Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Germany, Fed. Rep. of
Real GNP2.20.9–0.10.8‐1.1–1.2
Real domestic demand4.83.62.61.91.51.3
GNP deflator0.30.81.11.21.10.9
Short-term interest rate (percent)0.10.50.70.80.60.3
Long-term interest rate (percent)0.50.60.50.30.20.0
Nominal effective exchange rate1.91.91.71.40.90.6
Current account balance1–1.9–1.8–1.6–1.5–1.4–1.3
General government financial balance1–3.1–2.7–2.3–1.8–1.3–0.7
Gross private investment1–2.7–3.3–3.6–3.5–3.3–3.0
United States
Real GNP0.00.10.10.10.10.1
GNP deflator0.00.00.0–0.0–0.00.0
Short-term interest rate (percent)0.10.10.10.1–0.0–0.1
Nominal effective exchange rate (percent)–2.1–2.0–1.9–1.7–1.5–1.2
Current account balance1–0.00.00.10.10.10.1
Japan
Real GNP0.10.10.00.0–0.0–0.0
GNP deflator0.00.00.10.10.10.0
Short-term interest rate (percent)0.00.10.10.10.00.0
Nominal effective exchange rate (percent)–1.7–1.6–1.5–1.3–1.1–1.0
Current account balance10.10.10.10.10.10.0
United Kingdom
Real GNP–0.3–0.20.10.40.70.8
GNP deflator–0.1–0.3–0.5–0.7–0.8–0.7
Short-term interest rate (percent)0.30.30.2–0.1–0.3–0.5
Nominal effective exchange rate (percent)–2.2–2.4–2.4–2.2–1.7–1.1
Current account balance1–0.5–0.5–0.4–0.3–0.10.1
France
Real GNP–0.7–1.4–1.6–1.3–0.70.1
GNP deflator–0.4–1.2–2.4–3.7–4.9–5.7
Short-term interest rate (percent)0.20.40.50.50.50.3
Nominal effective exchange rate (percent)1.51.51.41.31.11.0
Current account balance10.60.40.30.20.10.0
Italy
Real GNP–0.7–1.4–1.6–1.5–1.1–0.5
GNP deflator–0.3–1.1–2.2–3.6–4.9–6.0
Short-term interest rate (percent)0.20.40.50.50.50.3
Nominal effective exchange rate (percent)1.51.41.31.21.11.0
Current account balance10.50.50.50.50.50.3
Canada
Real GNP0.10.00.00.10.10.1
GNP deflator0.00.00.00.0–0.00.0
Short-term interest rate (percent)0.10.10.10.0–0.0–0.0
Nominal effective exchange rate (percent)–1.1–1.0–0.9–0.8–0.6–0.5
Current account balance10.00.00.00.00.10.1
Smaller industrial countries
Real GNP–0.6–1.1–1.2–1.0–0.40.2
GNP deflator–0.3–0.8–1.6–2.5–3.2–3.7
Short-term interest rate (percent)0.20.40.50.50.50.3
Nominal effective exchange rate (percent)2.12.01.91.71.51.3
Current account balance10.60.40.30.20.20.2
Capital exporting developing countries
Real GDP0.0–0.2–0.2–0.2–0.10.0
Other developing countries
Real GDP (percent)0.0–0.1–0.1–0.1–0.0–0.0
GNP deflator (percent)1.81.61.20.70.2–0.2
Real imports (percent)–0.1–0.8–0.8–0.50.00.5
Interest payments2–0.3–0.00.10.10.1–0.0
Current account balance10.00.00.00.0–0.0–0.0
World prices (in dollars)
Price of oil1.61.41.00.4–0.1–0.5
Price index of commodities1.40.70.20.00.10.4

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 14.Increase of 10 Percent in the German Money Supply Target(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Germany, Fed. Rep. of
Real GNP5.65.02.70.3–1.2–1.7
Real domestic demand4.34.02.50.7–0.6–1.2
GNP deflator1.64.57.49.610.610.8
Short-term interest rate (percent)–3.0–3.4–2.1–0.21.42.0
Long-term interest rate (percent)–1.5–0.50.61.21.30.9
Nominal effective exchange rate–5.7–4.4–2.8–1.9–1.7–2.2
Current account balance10.40.60.40.1–0.0–0.0
General government financial balance10.40.4–0.1–0.7–1.0–1.1
Gross private investment110.06.11.4–2.1–3.5–3.1
United States
Real GNP0.1–0.4–0.5–0.5–0.4–0.1
GNP deflator0.00.20.30.30.20.0
Short-term interest rate (percent)–0.2–0.10.10.30.30.2
Nominal effective exchange rate (percent)7.15.84.33.33.13.6
Current account balance10.3–0.0–0.1–0.2–0.1–0.1
Japan
Real GNP–0.1–0.1–0.1–0.00.00.1
GNP deflator0.00.00.10.10.0–0.0
Short-term interest rate (percent)–0.0–0.0–0.00.00.10.0
Nominal effective exchange rate (percent)5.74.53.22.52.63.2
Current account balance1–0.0–0.0–0.00.00.00.0
United Kingdom
Real GNP1.6–0.0–1.6–2.7–3.0–2.4
GNP deflator0.71.92.83.02.51.3
Short-term interest rate (percent)–0.6–0.30.61.51.81.5
Nominal effective exchange rate (percent)8.77.66.14.32.81.9
Current account balance12.41.71.00.3–0.2–0.6
France
Real GNP3.34.23.41.6–0.4–2.0
GNP deflator1.34.17.811.414.215.4
Short-term interest rate (percent)–2.6–2.7–2.0–0.21.21.5
Nominal effective exchange rate (percent)–4.9–4.2–3.3–2.6–2.4–2.6
Current account balance1–1.0–0.5–0.10.20.40.5
Italy
Real GNP3.84.53.72.00.0–1.6
GNP deflator1.34.27.911.915.117.0
Short-term interest rate (percent)–2.7–2.8–2.0–0.21.21.6
Nominal effective exchange rate (percent)–4.8–4.0–3.2–2.5–2.3–2.6
Current account balance1–1.0–0.9–0.8–0.6–0.20.2
Canada
Real GNP0.2–0.0–0.3–0.5–0.4–0.3
GNP deflator0.00.20.30.30.2–0.0
Short-term interest rate (percent)–0.10.00.20.30.30.1
Nominal effective exchange rate (percent)3.52.71.91.31.21.5
Current account balance10.20.1–0.0–0.1–0.2–0.3
Smaller industrial countries
Real GNP4.04.83.81.8–0.3–1.8
GNP deflator1.23.56.69.612.013.2
Short-term interest rate (percent)–2.6–2.7–2.0–0.21.21.5
Nominal effective exchange rate (percent)–6.6–5.5–4.4–3.4–3.2–3.5
Current account balance1–1.0–0.10.30.50.50.3
Capital exporting developing countries
Real GDP1.21.10.6–0.1–0.5–0.7
Other developing countries
Real GDP (percent)0.40.30.2–0.0–0.1–0.2
GNP deflator (percent)–4.6–2.30.22.02.72.3
Real imports (percent)4.53.61.0–1.6–3.0–3.2
Interest payments20.1–0.3–0.30.00.30.4
Current account balance1–0.1–0.00.00.10.10.0
World prices (in dollars)
Price of oil–4.5–2.40.01.92.82.6
Price index of commodities1.52.62.20.8–0.7–1.7

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 15.Increase of U.K. Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
United Kingdom
Real GNP2.71.40.2–1.0–1.8–2.3
Real domestic demand5.03.72.31.10.2–0.4
GNP deflator0.51.32.12.73.03.0
Short-term interest rate (percent)–0.20.10.61.01.31.3
Long-term interest rate (percent)0.50.81.01.10.90.6
Nominal effective exchange rate4.74.94.94.53.52.4
Current account balance1–0.7–0.5–0.3–0.1–0.1–0.2
General government financial balance1–2.8–2.5–2.2–1.8–1.5–1.1
Gross private investment1–2.7–4.1–5.5–6.4–6.8–6.6
United States
Real GNP0.00.0–0.0–0.0–0.00.0
GNP deflator0.00.00.00.00.00.0
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.3–0.3–0.3–0.3–0.2–0.1
Current account balance10.00.00.0–0.00.00.0
Germany, Fed. Rep. of
Real GNP0.1–0.0–0.1–0.1–0.00.1
GNP deflator0.10.10.10.10.0–0.0
Short-term interest rate (percent)0.10.10.20.20.10.0
Nominal effective exchange rate (percent)–0.0–0.1–0.1–0.2–0.3–0.3
Current account balance10.10.10.00.00.00.0
Japan
Real GNP0.10.00.0–0.0–0.00.0
GNP deflator0.00.00.00.00.00.0
Short-term interest rate (percent)0.00.00.10.10.00.0
Nominal effective exchange rate (percent)–0.3–0.3–0.2–0.2–0.1–0.1
Current account balance10.00.00.00.00.00.0
France
Real GNP0.0–0.1–0.1–0.1–0.1–0.0
GNP deflator0.00.0–0.0–0.1–0.2–0.3
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.2–0.2–0.2–0.1–0.0
Current account balance10.10.0–0.0–0.1–0.1–0.1
Italy
Real GNP0.1–0.1–0.2–0.2–0.2–0.1
GNP deflator0.0–0.0–0.1–0.2–0.3–0.5
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.3–0.2–0.2–0.1–0.1
Current account balance10.10.0–0.0–0.1–0.1–0.1
Canada
Real GNP0.1–0.0–0.1–0.1–0.0–0.0
GNP deflator0.00.10.10.10.0–0.0
Short-term interest rate (percent)0.10.10.10.10.10.0
Nominal effective exchange rate (percent)–0.1–0.1–0.1–0.1–0.1–0.1
Current account balance10.10.0–0.0–0.0–0.1–0.1
Smaller industrial countries
Real GNP0.30.20.10.0–0.1–0.1
GNP deflator0.10.20.30.40.40.3
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.2–0.2–0.2–0.1–0.0
Current account balance10.10.10.10.10.10.1
Capital exporting developing countries
Real GDP0.1–0.0–0.1–0.2–0.2–0.2
Other developing countries
Real GDP (percent)0.00.0–0.0–0.0–0.0–0.0
GNP deflator (percent)0.60.60.70.60.50.4
Real imports (percent)0.3–0.3–0.7–0.9–0.8–0.6
Interest payments2–0.2–0.00.10.10.10.1
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil0.40.50.60.60.50.4
Price index of commodities1.10.90.60.40.20.1

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 16.Increase of 10 Percent in the U.K. Money Supply Target(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
United Kingdom
Real GNP2.14.65.34.52.91.0
Real domestic demand2.34.14.74.33.21.8
GNP deflator0.51.32.85.07.39.4
Short-term interest rate (percent)–2.3–3.5–3.4–2.4–0.90.5
Long-term interest rate (percent)–2.5–1.9–0.90.21.11.7
Nominal effective exchange rate–13.5–11.6–8.7–5.7–3.5–2.6
Current account balance1–4.0–2.5–1.3–0.40.20.5
General government financial balance1–0.70.10.30.30.1–0.1
Gross private investment18.78.16.03.00.1–2.1
United States
Real GNP0.1–0.0–0.1–0.2–0.2–0.1
GNP deflator0.00.10.10.10.10.1
Short-term interest rate (percent)–0.0–0.00.00.10.10.1
Nominal effective exchange rate (percent)0.70.60.40.30.20.2
Current account balance10.20.10.0–0.0–0.0–0.0
Germany, Fed. Rep. of
Real GNP0.2–0.0–0.3–0.4–0.4–0.3
GNP deflator0.10.20.40.40.30.2
Short-term interest rate (percent)–0.1–0.10.00.20.20.2
Nominal effective exchange rate (percent)0.70.70.60.40.20.1
Current account balance10.30.20.10.0–0.0–0.0
Japan
Real GNP0.10.0–0.0–0.0–0.0–0.0
GNP deflator0.00.00.00.10.00.0
Short-term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)0.60.50.30.20.10.2
Current account balance10.00.00.00.00.00.0
France
Real GNP0.40.2–0.1–0.4–0.5–0.5
GNP deflator0.10.30.40.40.2–0.1
Short-term interest rate (percent)0.00.00.00.10.10.1
Nominal effective exchange rate (percent)0.60.50.30.20.10.1
Current account balance10.40.40.30.10.0–0.1
Italy
Real GNP0.30.2–0.0–0.2–0.4–0.5
GNP deflator0.10.20.40.40.30.0
Short-term interest rate (percent)0.00.00.00.10.10.1
Nominal effective exchange rate (percent)0.70.60.40.30.10.1
Current account balance10.30.30.30.20.10.0
Canada
Real GNP0.20.1–0.0–0.1–0.2–0.3
GNP deflator0.00.10.20.30.30.2
Short-term interest rate (percent)–0.0–0.00.00.10.20.2
Nominal effective exchange rate (percent)0.40.30.30.20.10.0
Current account balance10.30.20.20.10.10.0
Smaller industrial countries
Real GNP0.0–0.1–0.2–0.3–0.3–0.3
GNP deflator0.10.20.30.40.40.3
Short-term interest rate (percent)0.00.00.00.10.10.1
Nominal effective exchange rate (percent)0.70.60.40.20.10.1
Current account balance10.20.10.0–0.0–0.1–0.1
Capital exporting developing countries
Real GDP0.40.30.20.1–0.1–0.2
Other developing countries
Real GDP (percent)0.10.10.0–0.0–0.0–0.1
GNP deflator (percent)0.8–0.6–0.20.20.40.5
Real imports (percent)1.91.50.80.1–0.5–0.8
Interest payments2–0.1–0.1–0.10.00.10.1
Current account balance1–0.0–0.00.00.00.00.0
World prices (in dollars)
Price of oil–0.9–0.6–0.20.10.40.5
Price index of commodities–0.1–0.2–0.00.10.20.2

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 17.Increase of French Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
France
Real GNP3.43.22.20.7–1.0–2.6
Real domestic demand6.15.44.12.40.5–1.2
GNP deflator1.03.15.78.19.710.0
Short–term interest rate (percent)0.10.10.10.10.10.1
Long–term interest rate (percent)0.10.10.10.10.0–0.1
Nominal effective exchange rate0.10.00.00.00.00.0
Current account balance1–2.4–1.6–1.0–0.5–0.20.0
General government financial balance1–3.1–2.5–2.1–1.8–1.5–1.3
Gross private investment10.5–1.4–3.7–6.1–8.0–9.0
United States
Real GNP0.10.0–0.1–0.1–0.1–0.0
GNP deflator0.00.10.10.10.0–0.0
Short–term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.2–0.1–0.1–0.00.0
Current account balance10.10.00.0–0.0–0.0–0.0
Japan
Real GNP0.10.00.0–0.0–0.0–0.0
GNP deflator0.00.00.10.00.00.0
Short–term interest rate (percent)0.00.00.10.00.0–0.0
Nominal effective exchange rate (percent)–0.1–0.1–0.1–0.00.10.1
Current account balance10.10.10.00.00.00.0
Germany, Fed. Rep. of
Real GNP0.3–0.0–0.2–0.3–0.2–0.1
GNP deflator0.10.30.30.30.20.1
Short–term interest rate (percent)0.10.10.20.30.20.1
Nominal effective exchange rate (percent)0.30.30.20.1–0.0–0.2
Current account balance10.40.20.10.10.10.1
United Kingdom
Real GNP0.2–0.1–0.2–0.3–0.3–0.2
GNP deflator0.10.20.20.20.1–0.1
Short–term interest rate (percent)0.10.10.20.20.20.1
Nominal effective exchange rate (percent)0.00.0–0.0–0.1–0.2–0.3
Current account balance10.20.10.0–0.1–0.2–0.2
Italy
Real GNP0.3–0.0–0.3–0.5–0.5–0.5
GNP deflator0.10.20.20.0–0.2–0.6
Short–term interest rate (percent)0.10.10.10.10.10.1
Nominal effective exchange rate (percent)0.00.00.00.00.00.0
Current account balance10.30.20.10.1–0.0–0.1
Canada
Real GNP0.20.0–0.1–0.1–0.1–0.1
GNP deflator0.00.10.10.10.10.0
Short–term interest rate (percent)0.00.10.10.10.0–0.0
Nominal effective exchange rate (percent)–0.1–0.1–0.1–0.1–0.1–0.0
Current account balance10.20.10.0–0.0–0.0–0.1
Smaller industrial countries
Real GNP0.40.20.0–0.1–0.2–0.2
GNP deflator0.10.20.40.40.40.3
Short–term interest rate (percent)0.10.10.10.10.10.1
Nominal effective exchange rate (percent)0.10.10.10.10.00.0
Current account balance10.30.30.20.20.10.1
Capital exporting developing countries
Real GDP0.40.20.1–0.1–0.2–0.3
Other developing countries
Real GDP (percent)0.10.0–0.0–0.0–0.1–0.1
GNP deflator (percent)0.50.50.60.70.60.5
Real imports (percent)1.10.2–0.4–0.8–1.0–0.9
Interest payments2–0.3–0.10.00.10.10.1
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil0.30.50.70.90.90.8
Price index of commodities1.40.90.40.0–0.2–0.3

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 18.Increase of Italian Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Italy
Real GNP3.63.63.01.80.2–1.5
Real domestic demand6.66.45.64.32.50.5
GNP deflator1.13.46.59.912.814.7
Short–term interest rate (percent)0.10.10.20.20.20.1
Long–term interest rate (percent)0.10.10.10.10.0–0.0
Nominal effective exchange rate0.10.10.10.10.10.1
Current account balance1–2.2–1.8–1.4–0.9–0.50.0
General government financial balance1–2.4–1.8–1.3–0.9–0.6–0.5
Gross private investment12.00.8–1.1–3.5–5.9–8.0
United States
Real GNP0.10.0–0.0–0.1–0.1–0.1
GNP deflator0.00.10.10.10.10.0
Short–term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.2–0.2–0.1–0.00.0
Current account balance10.10.10.00.0–0.0–0.0
Japan
Real GNP0.10.10.00.0–0.00.0
GNP deflator0.00.00.10.10.0–0.0
Short–term interest rate (percent)0.00.10.10.10.0–0.0
Nominal effective exchange rate (percent)–0.2–0.2–0.1–0.10.00.1
Current account balance10.10.10.10.10.00.0
Germany, Fed. Rep. of
Real GNP0.2–0.0–0.2–0.3–0.3–0.2
GNP deflator0.10.20.30.40.30.2
Short–term interest rate (percent)0.00.10.20.30.30.2
Nominal effective exchange rate (percent)0.30.30.30.20.0–0.1
Current account balance10.30.20.20.10.10.1
United Kingdom
Real GNP0.2–0.0–0.2–0.3–0.3–0.2
GNP deflator0.10.20.20.20.1–0.1
Short–term interest rate (percent)0.10.10.20.20.20.1
Nominal effective exchange rate (percent)–0.1–0.1–0.1–0.2–0.3–0.3
Current account balance10.20.10.0–0.0–0.1–0.2
France
Real GNP0.30.0–0.1–0.3–0.4–0.3
GNP deflator0.10.20.20.20.0–0.2
Short–term interest rate (percent)0.10.10.10.20.20.1
Nominal effective exchange rate (percent)0.10.10.10.10.10.1
Current account balance10.30.20.20.10.0–0.0
Canada
Real GNP0.20.1–0.0–0.1–0.1–0.1
GNP deflator0.00.10.20.20.20.1
Short–term interest rate (percent)0.10.10.10.10.10.0
Nominal effective exchange rate (percent)–0.1–0.1–0.1–0.2–0.2–0.2
Current account balance10.20.10.10.10.0–0.0
Smaller industrial countries
Real GNP0.30.10.0–0.1–0.2–0.2
GNP deflator0.10.20.20.30.20.1
Short–term interest rate (percent)0.10.10.10.20.20.1
Nominal effective exchange rate (percent)0.10.10.10.10.10.1
Current account balance10.30.20.20.20.20.1
Capital exporting developing countries
Real GDP0.20.1–0.0–0.1–0.2–0.2
Other developing countries
Real GDP (percent)0.00.0–0.0–0.0–0.1–0.1
GNP deflator (percent)0.50.60.70.70.70.6
Real imports (percent)1.10.3–0.2–0.6–0.9–1.0
Interest payments20.3–0.10.00.10.10.1
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil0.30.50.70.80.90.8
Price index of commodities1.61.10.70.30.1–0.0

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 19.Increase of Canadian Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Canada
Real GNP1.20.80.3–0.3–0.9–1.4
Real domestic demand5.14.43.52.71.91.2
GNP deflator0.10.50.91.31.72.0
Short-term interest rate (percent)–0.4–0.4–0.10.30.60.8
Long-term interest rate (percent)–0.00.20.50.70.80.8
Nominal effective exchange rate4.04.44.95.04.94.4
Current account balance1–2.1–1.7–1.4–1.1–0.8–0.7
General government financial balance1–3.0–2.4–2.0–1.6–1.3–1.0
Gross private investment1–0.8–1.6–2.5–3.2–3.7–4.1
United States
Real GNP0.10.0–0.1–0.1–0.1–0.1
GNP deflator0.00.10.10.10.10.1
Short-term interest rate (percent)0.00.10.10.10.10.1
Nominal effective exchange rate (percent)–0.4–0.5–0.6–0.6–0.7–0.6
Current account balance10.10.10.00.00.00.1
Japan
Real GNP0.10.00.0–0.0–0.00.0
GNP deflator0.00.10.10.10.10.0
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.2–0.2–0.2–0.2–0.2–0.2
Current account balance10.10.10.10.10.10.1
Germany, Fed. Rep. of
Real GNP0.20.10.0–0.00.00.0
GNP deflator0.00.10.10.10.10.0
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.1–0.1–0.2–0.2–0.3–0.3
Current account balance10.20.10.10.10.10.1
United Kingdom
Real GNP0.10.0–0.1–0.1–0.1–0.0
GNP deflator0.00.10.10.10.0–0.0
Short-term interest rate (percent)0.00.10.10.10.10.0
Nominal effective exchange rate (percent)–0.1–0.1–0.2–0.2–0.2–0.2
Current account balance10.10.10.00.0–0.0–0.0
France
Real GNP0.20.10.0–0.0–0.1–0.1
GNP deflator0.00.10.10.10.1–0.0
Short-term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)–0.3–0.3–0.3–0.3–0.2–0.2
Current account balance10.10.10.10.10.00.0
Italy
Real GNP0.20.1–0.0–0.1–0.1–0.1
GNP deflator0.00.10.10.0–0.0–0.1
Short-term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)–0.3–0.3–0.3–0.2–0.2–0.1
Current account balance10.10.10.10.00.0–0.0
Smaller industrial countries
Real GNP0.20.20.10.0–0.1–0.1
GNP deflator0.00.10.20.20.20.1
Short-term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)–0.5–0.5–0.5–0.5–0.4–0.3
Current account balance10.10.10.10.10.10.1
Capital exporting developing countries
Real GDP0.20.10.00.0–0.0–0.0
Other developing countries
Real GDP (percent)0.0–0.0–0.0–0.1–0.1–0.1
GNP deflator (percent)0.20.20.30.30.40.3
Real imports (percent)0.80.30.0–0.2–0.2–0.2
Interest payments2–0.10.00.10.20.20.2
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil–0.1–0.10.00.10.10.1
Price index of commodities0.40.0–0.2–0.2–0.3–0.2

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 20.Increase of 10 Percent in the Canadian Money Supply Target(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Canada
Real GNP3.54.44.12.91.50.1
Real domestic demand3.14.04.13.62.71.6
GNP deflator1.02.13.75.67.59.3
Short–term interest rate (percent)–2.6–3.5–3.2–2.2–0.90.3
Long–term interest rate (percent)–2.5–1.9–1.00.10.91.5
Nominal effective exchange rate–13.3–11.3–8.5–5.7–3.8–2.9
Current account balance1–2.2–1.8–1.3–0.9–0.6–0.3
General government financial balance1–0.9–0.3–0.1–0.2–0.6–0.8
Gross private investment16.86.14.42.40.5–1.0
United States
Real GNP–0.0–0.1–0.1–0.1–0.1–0.1
GNP deflator0.00.00.00.10.10.1
Short–term interest rate (percent)–0.1–0.1–0.1–0.00.10.2
Nominal effective exchange rate (percent)2.92.52.01.51.21.0
Current account balance10.1–0.0–0.1–0.1–0.0–0.0
Japan
Real GNP–0.1–0.0–0.0–0.1–0.0–0.0
GNP deflator0.00.00.00.10.10.1
Short–term interest rate (percent)–0.0–0.0–0.00.00.10.1
Nominal effective exchange rate (percent)0.50.40.30.10.10.1
Current account balance1–0.0–0.00.00.00.00.0
Germany, Fed. Rep. of
Real GNP0.00.1–0.0–0.1–0.1–0.0
GNP deflator0.10.10.20.20.20.1
Short–term interest rate (percent)–0.00.00.10.10.20.1
Nominal effective exchange rate (percent)0.30.30.20.1–0.1–0.2
Current account balance10.10.20.10.10.10.1
United Kingdom
Real GNP0.10.1–0.1–0.2–0.3–0.3
GNP deflator0.10.20.30.40.30.2
Short–term interest rate (percent)–0.0–0.00.10.20.20.2
Nominal effective exchange rate (percent)0.30.30.20.1–0.1–0.2
Current account balance10.20.20.20.10.1–0.0
France
Real GNP0.10.20.1–0.0–0.1–0.1
GNP deflator0.00.10.20.20.20.1
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)0.40.30.10.0–0.0–0.0
Current account balance10.10.20.20.10.10.1
Italy
Real GNP0.10.20.1–0.0–0.1–0.2
GNP deflator0.10.10.20.30.20.1
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)0.30.20.1–0.0–0.0–0.0
Current account balance10.10.20.20.10.10.1
Smaller industrial countries
Real GNP0.00.10.10.0–0.0–0.1
GNP deflator0.00.10.20.30.30.2
Short–term interest rate (percent)0.00.00.00.00.00.0
Nominal effective exchange rate (percent)0.70.60.30.10.00.0
Current account balance10.00.10.10.10.10.1
Capital exporting developing countries
Real GDP–0.00.10.00.0–0.0–0.0
Other developing countries
Real GDP (percent)0.00.00.00.0–0.0–0.0
GNP deflator (percent)1.1–0.8–0.4–0.10.10.2
Real imports (percent)0.20.60.40.1–0.1–0.3
Interest payments20.0–0.2–0.2–0.10.00.2
Current account balance10.0–0.0–0.00.00.0–0.0
World prices (in dollars)
Price of oil–0.4–0.3–0.2–0.1–0.00.0
Price index of commodities–0.2–0.1–0.1–0.3–0.4–0.5

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

Table 21.Increase of Smaller Industrial Government Spending by 5 Percent of GNP(Percentage deviation from baseline unless otherwise noted)
199019911992199319941995
Smaller industrial countries
Real GNP2.52.11.1–0.1–1.2–2.1
Real domestic demand5.14.23.11.90.8–0.0
GNP deflator0.61.73.14.35.05.1
Short-term interest rate (percent)0.10.30.40.40.40.3
Long-term interest rate (percent)0.30.30.30.20.10.0
Nominal effective exchange rate0.40.40.30.30.30.2
Current account balance1–2.3–1.7–1.3–1.1–1.0–1.0
General government financial balance1–3.3–2.7–2.2–1.8–1.4–1.0
Gross private investment1–1.9–3.2–4.6–6.0–6.9–7.3
United States
Real GNP0.20.1–0.1–0.1–0.1–0.0
GNP deflator0.10.10.20.20.20.2
Short-term interest rate (percent)0.10.10.20.20.20.1
Nominal effective exchange rate (percent)–0.6–0.6–0.5–0.4–0.3–0.2
Current account balance10.20.10.10.10.10.1
Japan
Real GNP0.20.10.0–0.0–0.0–0.0
GNP deflator0.10.10.20.20.20.2
Short-term interest rate (percent)0.10.10.20.20.20.1
Nominal effective exchange rate (percent)–0.5–0.4–0.4–0.3–0.10.0
Current account balance10.20.10.10.10.10.1
Germany, Fed. Rep. of
Real GNP1.00.1–0.3–0.4–0.3–0.1
GNP deflator0.30.70.90.90.70.5
Short-term interest rate (percent)0.10.30.50.60.50.4
Nominal effective exchange rate (percent)0.60.60.50.30.1–0.1
Current account balance11.00.70.50.50.50.5
United Kingdom
Real GNP0.80.1–0.3–0.6–0.6–0.5
GNP deflator0.20.50.70.80.60.4
Short-term interest rate (percent)0.10.30.50.60.60.4
Nominal effective exchange rate (percent)0.30.30.20.1–0.2–0.4
Current account balance10.80.60.40.20.10.0
France
Real GNP0.60.1–0.3–0.5–0.5–0.4
GNP deflator0.20.40.50.40.2–0.1
Short-term interest rate (percent)0.10.30.40.40.40.3
Nominal effective exchange rate (percent)0.30.30.20.20.20.2
Current account balance10.70.50.40.30.30.3
Italy
Real GNP0.5–0.0–0.3–0.5–0.6–0.5
GNP deflator0.10.20.30.1–0.1–0.5
Short-term interest rate (percent)0.10.30.40.40.40.3
Nominal effective exchange rate (percent)0.30.20.20.20.20.2
Current account balance10.50.40.30.30.20.2
Canada
Real GNP0.30.1–0.0–0.1–0.1–0.1
GNP deflator0.10.20.20.30.30.3
Short-term interest rate (percent)0.10.10.20.20.20.1
Nominal effective exchange rate (percent)–0.2–0.2–0.1–0.00.00.1
Current account balance10.30.20.20.10.10.2
Capital exporting developing countries
Real GDP0.60.30.0–0.1–0.2–0.2
Other developing countries
Real GDP (percent)0.20.10.0–0.1–0.1–0.1
GNP deflator (percent)1.11.31.51.51.31.1
Real imports (percent)2.40.8–0.1–0.6–0.7–0.5
Interest payments20.5–0.20.00.20.20.2
Current account balance10.00.00.00.00.00.0
World prices (in dollars)
Price of oil0.71.01.21.31.21.0
Price index of commodities3.32.21.10.1–0.5–0.8

As a percent of GNP.

As a percent of exports.

As a percent of GNP.

As a percent of exports.

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