Long-Run Exchange Rate Modeling: A Survey of the Recent Evidence
AbstractIn this paper the recent literature on long-run exchange rate modeling is surveyed. In particular, we review the voluminous literature that tests for a unit root in real exchange rates and the closely related work on testing for a unit root in the residual from a regression of the nominal exchange rate on relative prices. We argue that the balance of evidence is supportive of the existence of some form of long-run exchange rate relationship. The form of this relationship, however, does not accord exactly with a traditional representation of the long-run exchange rate, and we offer some potential explanations.
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Bibliographic InfoArticle provided by Palgrave Macmillan in its journal International Monetary Fund Staff Papers.
Volume (Year): 42 (1995)
Issue (Month): 3 (September)
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Web page: http://www.palgrave-journals.com/
Postal: Palgrave Macmillan Journals, Subscription Department, Houndmills, Basingstoke, Hampshire RG21 6XS, UK
Other versions of this item:
- Ronald MacDonald, 1995. "Long-Run Exchange Rate Modeling - A Survey of the Recent Evidence," IMF Working Papers 95/14, International Monetary Fund.
- F31 - International Economics - - International Finance - - - Foreign Exchange
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