affect agents' expectations; (iii) we find favorable evidence to Dornbusch's (1976) overshooting hypothesis …

overshooting in response to either temporary or permanent monetary shocks. Second, a transitory increase in the nominal interest …

inconsistent with simple overshooting models of the type considered by Dornbusch (1976). We also find that U.S. monetary policy was …

parameter values, the mark exhibits overshooting while the yen is characterized by undershooting. The constraints implied by the …

exchange rate determination. Dornbush's over-shooting hypothesis is the best known explanation of this phenomenon. This paper … exchange rate overshooting to undershooting. Using constrained maximum likelihood methods, the model is estimated for Germany … and the United States. The results provide strong evidence in support of the overshooting hypothesis for the Deutsche Mark …

Dornbusch overshooting. The relationship between real interest rates and real commodity prices is also supported empirically …

overshooting in the forward rate than in the spot rate. Thus, when agents observe a signal of higher future inflation, the …

intervention is not whether there are bankruptcies or not, but whether these can cause a large exchange rate overshooting once the …

We propose a new explanation for the forward-premium and the delayed-overshooting puzzles. Both puzzles arise from a …' regression; delayed overshooting may or may not occur depending upon the persistence of interest rate innovations and the degree …

often implies an initial period of overshooting as portfolios adjust. Asset prices will overshoot as well. Second, we show …