The Long-Run Relationship Between Real Exchange Rates and Real Interest Rate Differentials : A Panel Study /

This paper empirically examines the long-run relationship between real exchange rates and real interest rate differentials over the recent floating exchange rate period, using a panel cointegration method, with data for a set of industrialized countries. The paper finds evidence of statistically sig...

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Bibliographic Details
Main Author: Nagayasu, Jun
Other Authors: MacDonald, Ronald
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 1999.
Series:IMF Working Papers; Working Paper ; No. 1999/037
Online Access:Full text available on IMF
Description
Summary:This paper empirically examines the long-run relationship between real exchange rates and real interest rate differentials over the recent floating exchange rate period, using a panel cointegration method, with data for a set of industrialized countries. The paper finds evidence of statistically significant long-run relationships and plausible point estimates, which contrasts with much existing evidence. The failure of others to establish such relationships may reflect the estimation method they use rather than any inherent deficiency of the fundamentals-based models.
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Physical Description:1 online resource (12 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students