There is a debate on the excess volatility of long-term bond yields. It is found that whether long-term bond yields are excessively volatile or excessively smooth depends critically on the knowledge of the long-run properties of the short-term interest rate process. Uses a span of 200 years of...

This paper provides some additional empirical evidence on the effect of exchange-rate volatility on exports. The novelties of the study include: a regime-switching model in conditional volatility is employed to better capture the exchange-rate uncertainty; a 2SLS method as suggested by Hsiao is...