Real Exchange Rate Variability: An Empirical Analysis of the Developing Countries Case / Sebastian Edwards.

Format:

Book

Author/Creator:

Edwards, Sebastian.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w1930.

NBER working paper series no. w1930

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Real Exchange Rate Variability

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1986.

Summary:

The purpose of this paper is to investigate the potential role of monetary and real factors in explaining real exchange rate variability in developing countries. For this purpose two indexes of real effective exchange rate variability that measure short-term and long-term variability were constructed for 30 countries. The results obtained, using a generalized least squares procedures on cross section data, indicate that real exchange rate variability has been affected both by real and monetary factors. In particular it was found that more unstable nominal exchange rate policies were reflected in higher real exchange rate instability in the short-run; more unstable domestic credit policies resulted in higher short-term real exchange rate variability; and more unstable external terms of trade also affected positively the degree of real exchange rate instability.

Notes:

Print version record

May 1986.