Advanced Search
MyIDEAS: Login to save this article or follow this journal

The Dynamics of Uncertainty or the Uncertainty of Dynamics: Stochastic J-Curves


Author Info

  • Marquez, Jaime
Registered author(s):


    That the U.S. trade account will improve in response to a depreciation is not generally in doubt; the key questions are by how much and by when. Addressing these questions involves studying the distribution of trade-account responses to a depreciation. Given a depreciation of the dollar, the paper generates this distribution by simulating a trade model with random drawings of both innovations and elasticity estimates. Unlike previous studies, this analysis explains trade on a bilateral basis and uses the Full Information Maximum Likelihood estimator for parameter estimation. According to the findings, the dispersion of trade-account responses grows over time and is directly related to the magnitude of the depreciation. Furthermore, the probability of a slow adjustment of the trade account is relatively high and the 95 percent confidence intervals are too wide to be useful for policies that target a given trade-account path. Copyright 1991 by MIT Press.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL:
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See for details.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by MIT Press in its journal Review of Economics & Statistics.

    Volume (Year): 73 (1991)
    Issue (Month): 1 (February)
    Pages: 125-33

    as in new window
    Handle: RePEc:tpr:restat:v:73:y:1991:i:1:p:125-33

    Contact details of provider:
    Web page:

    Order Information:

    Related research



    No references listed on IDEAS
    You can help add them by filling out this form.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Roman Frydman & Michael D. Goldberg & Søren Johansen & Katarina Juselius, 2009. "A Resolution of the Purchasing Power Parity Puzzle: Imperfect Knowledge and Long Swings," CREATES Research Papers, School of Economics and Management, University of Aarhus 2009-01, School of Economics and Management, University of Aarhus.
    2. Calderon, Cesar & Chong, Alberto & Loayza, Norman, 2000. "Determinants of current account deficits in developing countries," Policy Research Working Paper Series, The World Bank 2398, The World Bank.
    3. Webber, A., 1999. "Dynamic and Long Run Responses of Import Prices to the Exchange Rate in the Asia-Pacific," Economics Working Papers, School of Economics, University of Wollongong, NSW, Australia WP99-11, School of Economics, University of Wollongong, NSW, Australia.
    4. Chang Byoung-Ky, 2001. "Exchange Rate Pass-Through in an International Duopoly model with Brand Loyalty," International Economic Journal, Taylor & Francis Journals, Taylor & Francis Journals, vol. 15(1), pages 41-59.


    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.


    Access and download statistics


    When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:73:y:1991:i:1:p:125-33. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Karie Kirkpatrick).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.