RDP 2007-06: The Butterfly Effect of Small Open Economies Equation (25)

( Γ 0 ∗ 0 Γ 0 21 Γ 0 22 ) ( y t * y t ) = ( Γ 1 ∗ 0 Γ 1 21 Γ 1 22 ) ( y t − 1 * y t − 1 ) + ( Ψ ∗ 0 Ψ 21 Ψ 22 ) ( ε t ∗ ε t ) + ( Π ∗ 0 Π 21 Π 22 ) ( η t ∗ η t ) . MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaWaaeWaaeaafa qabeGacaaabaGaeu4KdC0aa0baaSqaaiaaicdaaeaacqGHxiIkaaaa keaacaaIWaaabaGaeu4KdC0aa0baaSqaaiaaicdaaeaacaaIYaGaaG ymaaaaaOqaaiabfo5ahnaaDaaaleaacaaIWaaabaGaaGOmaiaaikda aaaaaaGccaGLOaGaayzkaaWaaeWaaeaadaWcaaqaaiaadMhadaqhaa WcbaGaamiDaaqaaiaacQcaaaaakeaacaWG5bWaaSbaaSqaaiaadsha aeqaaaaaaOGaayjkaiaawMcaaiabg2da9maabmaabaqbaeqabiGaaa qaaiabfo5ahnaaDaaaleaacaaIXaaabaGaey4fIOcaaaGcbaGaaGim aaqaaiabfo5ahnaaDaaaleaacaaIXaaabaGaaGOmaiaaigdaaaaake aacqqHtoWrdaqhaaWcbaGaaGymaaqaaiaaikdacaaIYaaaaaaaaOGa ayjkaiaawMcaamaabmaabaWaaSaaaeaacaWG5bWaa0baaSqaaiaads haiiaacqWFsislcaaIXaaabaGaaiOkaaaaaOqaaiaadMhadaWgaaWc baGaamiDaiab=jHiTiaaigdaaeqaaaaaaOGaayjkaiaawMcaaiabgU caRmaabmaabaqbaeqabiGaaaqaaiabfI6aznaaCaaaleqabaGaey4f IOcaaaGcbaGaaGimaaqaaiabfI6aznaaCaaaleqabaGaaGOmaiaaig daaaaakeaacqqHOoqwdaahaaWcbeqaaiaaikdacaaIYaaaaaaaaOGa ayjkaiaawMcaamaabmaabaWaaSaaaeaacqaH1oqzdaqhaaWcbaGaam iDaaqaaiabgEHiQaaaaOqaaiabew7aLnaaBaaaleaacaWG0baabeaa aaaakiaawIcacaGLPaaacqGHRaWkdaqadaqaauaabeqaciaaaeaacq WFGoaudaahaaWcbeqaaiabgEHiQaaaaOqaaiaaicdaaeaacqWFGoau daahaaWcbeqaaiaaikdacaaIXaaaaaGcbaGae8hOda1aaWbaaSqabe aacaaIYaGaaGOmaaaaaaaakiaawIcacaGLPaaadaqadaqaamaalaaa baGaeq4TdG2aa0baaSqaaiaadshaaeaacqGHxiIkaaaakeaacqaH3o aAdaWgaaWcbaGaamiDaaqabaaaaaGccaGLOaGaayzkaaGaaiOlaaaa @8BB2@