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Exchange-Rate Economics for the Resources Sector

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Author Info
Kenneth W Clements (UWA Business School, The University of Western Australia)
Yihui Lan () (UWA Business School, The University of Western Australia)
John Roberts (UWA Business School, The University of Western Australia)
Abstract

The paper provides an account of aspects of exchange-rate economics that are of particular relevance to the resources sector. The issues discussed include exchange-rate volatility and risk management practices used to deal with it, the role of productivity differences across countries, the impact of a booming resources sector on the country’s exchange rate and approaches to forecasting exchange rates. The discussion is organised around a simple stylised model that emphasises the quantity theory of money and purchasing power parity as a long-run link between prices and exchange rates.

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Paper provided by The University of Western Australia, Department of Economics in its series Economics Discussion / Working Papers with number 07-13.

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Length: 38 pages
Date of creation: 2007
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Handle: RePEc:uwa:wpaper:07-13

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