Mulder, Nanno; Baldi, Anne-Laure - Econometric Society - 2004
This paper analyses the impact of exchange rate regimes on real exchange rates, as defined by the relative price of …, the real exchange rate is determined in the long-run by the well-known Balassa-Samuelson effect, and in the medium and … short run by government expenditure and terms of trade. Another, little discussed, explanatory factor that may cause real …