Sources of real and nominal exchange rate fluctuations in transition economies
This paper provides an empirical inquiry into the sources of movements of the real and nominal exchange rates in Hungary and Poland for during the 1990:01-1998:02 period. We decompose the exchange rate movements into those attributable to real and nominal shocks, we find that (1) nominal shocks have played a significant role in Poland, but not in Hungary, in explaining real exchange rate movements during the transition period. Instead, real shocks have dominated real exchange movements in Hungary and (2) nominal shocks explain almost all of nominal exchange rate movements in Poland and a sizable portion of nominal exchange rate movements in Hungary. These results are compared with the findings of Lastrapes (1992) and Enders and Lee (1997) for industrial countries. Finally, policy implications of the empirical results as well their lessons for modeling exchange rates in transition economies are discussed.
|Date of creation:||1998|
|Date of revision:|
|Publication status:||Published in Journal of Compartive Economics as "Sources of Real Exchange Rate Fluctuations in Transition Economies: Evidence from Hungary and Poland."|
|Contact details of provider:|| Postal: |
Web page: http://www.stlouisfed.org/
More information through EDIRC
|Order Information:|| Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Portes, Richard, 1994. "Transformation Traps," Economic Journal, Royal Economic Society, vol. 104(426), pages 1178-89, September.
- Lionel Halpern & Charles Wyplosz, 1996.
"Equilibrium Exchange Rates in Transition Economies,"
IMF Working Papers
96/125, International Monetary Fund.
- LÃ¡szlÃ³ Halpern & Charles Wyplosz, 1997. "Equilibrium Exchange Rates in Transition Economies," IMF Staff Papers, Palgrave Macmillan, vol. 44(4), pages 430-461, December.
- Lastrapes, William D, 1992. "Sources of Fluctuations in Real and Nominal Exchange Rates," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 530-39, August.
- Desai, Padma, 1998. "Macroeconomic Fragility and Exchange Rate Vulnerability: A Cautionary Record of Transition Economies," Journal of Comparative Economics, Elsevier, vol. 26(4), pages 621-641, December.
- Begg, David, 1998.
"Pegging Out: Lessons from the Czech Exchange Rate Crisis,"
Journal of Comparative Economics,
Elsevier, vol. 26(4), pages 669-690, December.
- Begg, David, 1998. "Pegging Out: Lessons from the Czech Exchange Rate Crisis," CEPR Discussion Papers 1956, C.E.P.R. Discussion Papers.
- Alan C. Stockman, 1978.
"A Theory of Exchange Rate Determination,"
UCLA Economics Working Papers
113, UCLA Department of Economics.
- Brada, Josef C., 1998. "Introduction: Exchange Rates, Capital Flows, and Commercial Policies in Transition Economies," Journal of Comparative Economics, Elsevier, vol. 26(4), pages 613-620, December.
- Szapary, Gyorgy & Jakab, Zoltan M., 1998. "Exchange Rate Policy in Transition Economies: The Case of Hungary," Journal of Comparative Economics, Elsevier, vol. 26(4), pages 691-717, December.
- Lucjan T. Orlowski, 1996. "The Path of Exchange Rates in the Polish Economic Transformation," CASE Network Studies and Analyses 0090, CASE-Center for Social and Economic Research.
When requesting a correction, please mention this item's handle: RePEc:fip:fedlwp:1998-022. 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: (Anna Xiao)
If references are entirely missing, you can add them using this form.