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Tipo de cambio real en la República Dominicana: Enfoques alternativos de equilibrio y desalineamiento
[Real exchange rate in the Dominican Republic: Alternative approaches to equilibrium and misalignment]

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  • Cruz-Rodríguez, Alexis

Abstract

This article has two main objectives. First, estimate the real equilibrium exchange rate (REER) of the Dominican Republic, and second, to determine the misalignment, if any, between the observed real exchange rate (RER) and its equilibrium level. To carry out the analysis six different measurements and six measures of REER of misalignment were used. The empirical results indicate that in the 50s, 60s, 90s and the first decade of the 2000s there was an overvaluation, while in the 70s and 80s there was an undervaluation of the RER. Between the years 2010-2013 the RER stood very close to its long term equilibrium level. However, misalignment and magnitude have different responses depending on the methodology used to estimate the REER.

Suggested Citation

  • Cruz-Rodríguez, Alexis, 2015. "Tipo de cambio real en la República Dominicana: Enfoques alternativos de equilibrio y desalineamiento [Real exchange rate in the Dominican Republic: Alternative approaches to equilibrium and misali," MPRA Paper 70943, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:70943
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    More about this item

    Keywords

    Real exchange rate; exchange rate misalignment; purchasing power parity.;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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