Anticipated Real Exchange Rate Changes And The Dynamics Of Investment PDF Download
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Author | : Luis Serven |
Publisher | : World Bank Publications |
Total Pages | : 54 |
Release | : 1990 |
Genre | : Foreign exchange rates |
ISBN | : |
Download Anticipated Real Exchange-rate Changes and the Dynamics of Investment Book in PDF, ePub and Kindle
Unanticipated changes in the real exchange rate affect investment through their impact on the desired capital stock, whose direction depends on a number of factors and is in general ambiguous. In contrast, anticipated changes can also have an important effect on the optimal timing of investment, in a direction that depends on the financial openness of the economy and on the important content of capital goods. This issue is explored using a simple macroeconomic model.
Author | : Steve Brito |
Publisher | : International Monetary Fund |
Total Pages | : 21 |
Release | : 2018-05-10 |
Genre | : Business & Economics |
ISBN | : 1484356349 |
Download Real Exchange Rates, Economic Complexity, and Investment Book in PDF, ePub and Kindle
We show that the response of firm-level investment to real exchange rate movements varies depending on the production structure of the economy. Firms in advanced economies and in emerging Asia increase investment when the domestic currency weakens, in line with the traditional Mundell-Fleming model. However, in other emerging market and developing economies, as well as some advanced economies with a low degree of structural economic complexity, corporate investment increases when the domestic currency strengthens. This result is consistent with Diaz Alejandro (1963)—in economies where capital goods are mostly imported, a stronger real exchange rate reduces investment costs for domestic firms.
Author | : José Campa |
Publisher | : |
Total Pages | : 68 |
Release | : 1996 |
Genre | : Foreign exchange rates |
ISBN | : |
Download Investment, Pass-through and Exchange Rates Book in PDF, ePub and Kindle
Author | : Falkmar Butgereit |
Publisher | : Diplomica Verlag |
Total Pages | : 120 |
Release | : 2010 |
Genre | : Business & Economics |
ISBN | : 383669543X |
Download Exchange Rate Determination Puzzle Book in PDF, ePub and Kindle
Still after more than thirty years of free floating exchange rates, large parts of exchange rate dynamics remain a puzzle. As this book shows, much progress has been made in explaining exchange rate movements over longer horizons. It also shows, however, that short-run movements are far more challenging to explain. The book is based upon a variety of papers, many of them released recently. A key aspiration of the literature has always been not only to explain past exchange rate behavior but also to forecast out of sample and to compare it to the simple random walk outcome. Here some development has been made after Meese and Rogoff's (1983) truculent verdict of the performance of common exchange rate models. By means of empirical analysis and descriptive statistics this book further supports the established long-run relationships between exchange rates and fundamentals such as expected productivity growth, real GDP growth, domestic investment, interest rates, inflation, government spending, and current account balances. It finds that these fundamentals affect the exchange rate to varying degrees over time. Turning to short-term exchange rate dynamics, it turns out that a different set of forces is at play. The key to explaining short-run movements is to be found in an extensive micro-foundation that factors in a pronounced heterogeneity among market participants and information asymmetries, as well as the possibility of sudden shifts in sentiment, beliefs, and the degree of risk aversion. Promising results have been obtained by order-flow analysis and high frequency data. Also, the consideration of chartism and speculators facilitates understanding for otherwise puzzling exchange rate movements. The last attempt to tackle the understanding of exchange rate behavior is the use of frequency domain analysis and in particular spectral analysis which tries to track down any cyclical patterns in the various moments of time series. And as we shall see forex indeed incorpor
Author | : Nancy C. Benjamin |
Publisher | : |
Total Pages | : 34 |
Release | : 1996 |
Genre | : |
ISBN | : |
Download Dynamic investment responses to real exchange rate changes Book in PDF, ePub and Kindle
Author | : Eliana A. Cardoso |
Publisher | : |
Total Pages | : 38 |
Release | : 1983 |
Genre | : Foreign exchange |
ISBN | : |
Download Exchange Rate Dynamics and the Stock Market Book in PDF, ePub and Kindle
Author | : John Y. Campbell |
Publisher | : |
Total Pages | : 56 |
Release | : 2002 |
Genre | : Foreign exchange market |
ISBN | : |
Download Foreign Currency for Long-term Investors Book in PDF, ePub and Kindle
Conventional wisdom holds that conservative investors should avoid exposure to foreign currency risk. Even if they hold foreign equities, they should hedge the currency exposure of these positions and should hold only domestic Treasury bills. This paper argues that the conventional wisdom may be wrong for long-term investors. Domestic bills are risky for long-term investors, because real interest rates vary over time and bills must be rolled over at uncertain future interest rates. This risk can be hedged by holding foreign currency if the domestic currency tends to depreciate when the domestic real interest rate falls, as implied by the theory of uncovered interest parity. Empirically this effect is important and can lead conservative long-term investors to hold more than half their wealth in foreign currency.
Author | : Leonardo Leiderman |
Publisher | : Cambridge University Press |
Total Pages | : 400 |
Release | : 1994-07-14 |
Genre | : Business & Economics |
ISBN | : 9780521454384 |
Download Capital Mobility Book in PDF, ePub and Kindle
This edited volume examines capital mobility in both industrialised and developing countries.
Author | : D. T. Nguyen |
Publisher | : |
Total Pages | : 116 |
Release | : 1986 |
Genre | : Australia |
ISBN | : |
Download Exchange Rates and the Economy Book in PDF, ePub and Kindle
Author | : Enrique Martínez-García |
Publisher | : |
Total Pages | : |
Release | : 2009 |
Genre | : |
ISBN | : |
Download The Real Exchange Rate in Sticky-price Models Book in PDF, ePub and Kindle