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 InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 95/14.
Date of creation: 01 Jan 1995
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Other versions of this item:
- Ronald Macdonald, 1995. "Long-Run Exchange Rate Modeling: A Survey of the Recent Evidence," IMF Staff Papers, Palgrave Macmillan, vol. 42(3), pages 437-489, September.
- F31 - International Economics - - International Finance - - - Foreign Exchange
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-16 (All new papers)
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