Long swings and chaos in the exchange rate in a DSGE model with a Taylor rule

A DSGE model with a Taylor rule is augmented with an evolutionary switching between technical and fundamental analyses in currency trade, where the fractions of these trading tools are determined within the model. Then, a shock hits the economy. As a result, chaotic dynamics and long swings may occur in the exchange rate, which are appealing features of the model given existing empirical evidence on chaos and long swings in exchange rate fluctuations.

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Year of publication:	2007-11-12
Authors:	Bask, Mikael
Institutions:	Suomen Pankki
Subject:	chaotic dynamics \| foreign exchange \| fundamental analysis \| monetary policy \| technical analysis

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Extent:	application/pdf
Series:	Research Discussion Papers.
Type of publication:	Book / Working Paper
Language:	English
Notes:	The text is part of a series Research Discussion Papers The price is Available online only. Number 19/2007 28 pages
Classification:	C65 - Miscellaneous Mathematical Tools ; E32 - Business Fluctuations; Cycles ; E44 - Financial Markets and the Macroeconomy ; E52 - Monetary Policy (Targets, Instruments, and Effects) ; F31 - Foreign Exchange
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005648889