The Fundamental Determinants of the Real Exchange Rate of the U. S. Dollar Relative to Other G-7 Currencies

The Fundamental Determinants of the Real Exchange Rate of the U. S. Dollar Relative to Other G-7 Currencies PDF Author: Mr.Jerome L. Stein
Publisher: International Monetary Fund
ISBN: 1451955146
Category : Business & Economics
Languages : en
Pages : 46

Book Description
The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and national and international economic developments.

Exchange Rate Misalignment in Developing Countries

Exchange Rate Misalignment in Developing Countries PDF Author: Sebastian Edwards
Publisher: Johns Hopkins University Press
ISBN:
Category : Business & Economics
Languages : en
Pages : 110

Book Description
This article analyzes the theory of equilibrium real exchange rates and defines misalignment as a deviation of the real exchange rate (RER) from its equilibrium level. The role of macroeconomic policies is then analyzed under three alternative nominal exchange rate regimes: predetermined nominal exchange rates; floating nominal rates; and dual or black market nominal exchange rates. This discussion points out how inconsistent macroeconomic policies often lead to real exchange rate misalignment. Corrective measures, including nominal devaluation and several alternative approaches, are then evaluated.

Terms of Trade and Real Exchange Rates

Terms of Trade and Real Exchange Rates PDF Author: Robert A. Amano
Publisher:
ISBN:
Category : Foreign exchange rates
Languages : en
Pages : 52

Book Description


Estimating Equilibrium Exchange Rates

Estimating Equilibrium Exchange Rates PDF Author: John Williamson
Publisher: Peterson Institute
ISBN: 9780881320763
Category : Business & Economics
Languages : en
Pages : 608

Book Description
The problems of exchange rate misalignments and the resulting payments imbalances have plagued the world economy for decades. At the Louvre Accord of 1987, the Group of Five industrial countries adopted a system of reference ranges for exchange rate management, influenced by proposals of C. Fred Bergstan and John Williamson for a target zone system. The reference range approach has, however, been operated only intermittently and half-heartedly, and questions continue to be raised in policy and scholarly circles about the design and operation of a full-fledged target zone regime. This volume, with chapters by leading international economists, explores one crucial issue in the design of a target zone system: the problem of calculating Williamson's concept of the fundamental equilibrium exchange rate (FEER). Williamson contributes an overview of the policy and analytic issues and a second chapter on his own calculations.

Fundamental Determinants of Exchange Rates

Fundamental Determinants of Exchange Rates PDF Author: Jerome L. Stein
Publisher: Oxford University Press
ISBN: 9780198293064
Category : Business & Economics
Languages : en
Pages : 276

Book Description
"This book greatly enhances our understanding of the behavior of real exchange rates. It provides an elegant model based on a solid theoretical foundation that links real exchange rates to their fundamental economic determinants and takes proper account of stock and flow considerations. The authors provide a masterful account of how changes in productivity and thrift affect the real exchange rate, and show that the long-run impact depends crucially on whether the change reflects the former fundamental (investment) or the latter (consumption). The empirical implementation uses state-of-the-art cointegration and error correction methodologies that are eminently well suited to capture the short-run adjustment of the real exchange rate to its medium- to long-run equilibrium value. The empirical results are extremely encouraging, as the economic fundamentals identified by the authors can explain a substantial part of the movement in the real exchange rate of a number of countries."--Peter Clark, International Monetary Fund

Real and Monetary Determinants of Real Exchange Rate Behavior

Real and Monetary Determinants of Real Exchange Rate Behavior PDF Author: Sebastian Edwards
Publisher:
ISBN:
Category : Foreign exchange
Languages : en
Pages : 68

Book Description
This paper develops a dynamic model of real exchange rate behavior in developing countries. A three goods economy (exportables, importables and nontradables) is considered. Residents of this country hold domestic and foreign assets, and there is a dual exchange rate regime. There is a government that consumes importables and nontradables. A distinction is made between equilibrium and disequilibrium movements of the RER. The determinants of real exchange rate misalignment are studied with emphasis placed on the role of devaluations and balance of payments crisis. The implications of the model are tested using data for 12 developing countries. The results obtained are generally favorable for the model. The issue of RER stationarity is also analyzed.

Capital Inflows and Real Exchange Rate Appreciation in Latin America

Capital Inflows and Real Exchange Rate Appreciation in Latin America PDF Author: Guillermo A. Calvo
Publisher:
ISBN:
Category : Capital movements
Languages : en
Pages : 70

Book Description


Exchange Rate Economics

Exchange Rate Economics PDF Author: Ronald MacDonald
Publisher: Routledge
ISBN: 1134838220
Category : Foreign exchange
Languages : en
Pages : 334

Book Description
''In summary, the book is valuable as a textbook both at the advanced undergraduate level and at the graduate level. It is also very useful for the economist who wants to be brought up-to-date on theoretical and empirical research on exchange rate behaviour.'' ""Journal of International Economics""

Exchange Rate Misalignment

Exchange Rate Misalignment PDF Author: Lawrence E. Hinkle
Publisher: World Bank Publications
ISBN: 019521126X
Category : Business & Economics
Languages : en
Pages : 638

Book Description
The study cautiously identifies exchange rate misalignment as an important element in most of the exchange rate crises that plagued the developing world during the last decade. Given that the increasing integration of world capital markets, has escalated the costs of such crises, a broad consensus emerged in recent years, that the overriding objective of exchange rate policy in developing countries, should be to avoid episodes of prolonged, and substantial misalignment, i.e., situations in which the actual real exchange rate differs significantly from its long-run equilibrium value. It was the Bank's involvement in one such misalignment episode, that eventually led to this book. Following an overview on the concepts and measurement of exchange rate misalignment, its impact on the purchasing power parity, and the relationship between the external real exchange rate (RER), and the two-good internal RER for tradables non-tradables, the study presents methodologies - empirical applications - for estimating the RER equilibrium. The study reaches an optimistic conclusion - that enough is known to identify cases of misalignment, and be able to sound clear warning signals. The implication for exchange rate policy is that ignorance about the empirical value of the equilibrium exchange rate, cannot be used to clinch arguments for extreme exchange arrangements, such as clean floats, currency boards, and "dollarization."

Exchange Rate Theory and Practice

Exchange Rate Theory and Practice PDF Author: John F. Bilson
Publisher: University of Chicago Press
ISBN: 0226050998
Category : Business & Economics
Languages : en
Pages : 542

Book Description
This volume grew out of a National Bureau of Economic Research conference on exchange rates held in Bellagio, Italy, in 1982. In it, the world's most respected international monetary economists discuss three significant new views on the economics of exchange rates - Rudiger Dornbusch's overshooting model, Jacob Frenkel's and Michael Mussa's asset market variants, and Pentti Kouri's current account/portfolio approach. Their papers test these views with evidence from empirical studies and analyze a number of exchange rate policies in use today, including those of the European Monetary System.