Fundamentals of real exchange rate determination: what role in the peso crisis?
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| Format: | Artículo científico |
| Language: | en |
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El Colegio de México, A.C.
2006
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| _version_ | 1876482950706495488 |
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| author | Arne Kildegaard |
| author_facet | Arne Kildegaard |
| contents | Fundamentals of real exchange rate determination: what role in the peso crisis? Arne Kildegaard Economía y Finanzas cointegration Real exchange rates exchange rate crisis purchasing power parity We examine the role of structural factors in the Mexican real exchangerate experience since 1970, particularly in the crisis of December, 1994.We find that "fundamental" determinants of the real exchange-omittedfrom previous research-are cointegrated with nominal exchange ratesand relative prices, while tests of PPP alone fail. The cointegratingequation indicates a severe undervaluation during the 1980s and onlymodest overvaluation in the period immediately preceding the devaluation in December, 1994. Nothing in the fundamentals can accountfor magnitude of the blow Mexico suffered at that time. 2006 artículo científico 0188-6916 https://www.redalyc.org/articulo.oa?id=59721101 en http://www.redalyc.org/revista.oa?id=597 Estudios Económicos application/pdf El Colegio de México, A.C. Estudios Económicos (México) Num.1 Vol.21 |
| format | Artículo científico |
| id | redalyc_59721101 |
| institution | Redalyc |
| language | en |
| publishDate | 2006 |
| publisher | El Colegio de México, A.C. |
| spellingShingle | Fundamentals of real exchange rate determination: what role in the peso crisis? Arne Kildegaard Economía y Finanzas cointegration Real exchange rates exchange rate crisis purchasing power parity Fundamentals of real exchange rate determination: what role in the peso crisis? Arne Kildegaard Economía y Finanzas cointegration Real exchange rates exchange rate crisis purchasing power parity We examine the role of structural factors in the Mexican real exchangerate experience since 1970, particularly in the crisis of December, 1994.We find that "fundamental" determinants of the real exchange-omittedfrom previous research-are cointegrated with nominal exchange ratesand relative prices, while tests of PPP alone fail. The cointegratingequation indicates a severe undervaluation during the 1980s and onlymodest overvaluation in the period immediately preceding the devaluation in December, 1994. Nothing in the fundamentals can accountfor magnitude of the blow Mexico suffered at that time. 2006 artículo científico 0188-6916 https://www.redalyc.org/articulo.oa?id=59721101 en http://www.redalyc.org/revista.oa?id=597 Estudios Económicos application/pdf El Colegio de México, A.C. Estudios Económicos (México) Num.1 Vol.21 |
| title | Fundamentals of real exchange rate determination: what role in the peso crisis? |
| topic | Economía y Finanzas cointegration Real exchange rates exchange rate crisis purchasing power parity |
| url | https://www.redalyc.org/articulo.oa?id=59721101 |