Includes index.

Contents: Introduction -- Modeling the open economy -- Some basic relations -- Employment, the trade balance, and relative prices -- Income determination and the table balance -- Relative prices, equilibrium output, and the trade balance -- Intermediate goods and nontraded goods -- Home goods and traded goods: the dependent economy model -- Money and payments adjustment -- Money, prices, and payments adjustment -- Money, exchange rates, and employment -- Monetary and exchange rate policy for macroeconomic stability -- Assets markets, capital mobility, and stabilization policy -- Stabilization policy under fixed exchange rates and capital mobility -- Flexible exchange rates and capital mobility -- Monetary stabilization, intervention, and real appreciation -- Portfolio balance and the current account -- Exchange rates, assets markets, and the current account -- Growth, the balance of payments, and the exchange rate.