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and inflation risk. Both sources of uncertainty make it difficult to stabilize consumption over time. However, investors …
Persistent link: https://www.econbiz.de/10013016077
This note examines the behavior of a competitive firm that faces joint price and inflation risk. Given that the price … risk is negatively correlated with the inflation risk in the sense of expectation dependence, the firm optimally opts for … inflation risk, it is not the case when the inflation risk prevails. In contrast to the conventional wisdom, forward hedging …
Persistent link: https://www.econbiz.de/10011521691
and inflation risk. Both sources of uncertainty make it difficult to stabilize consumption over time. However, investors …
Persistent link: https://www.econbiz.de/10011306018
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In this companion paper to Broll and Mukherjee (2017), we empirically analyse how exchange rate volatilities affect firms optimal production and exporting decisions. The firms elasticity of risk aversion determines the direction of the impact of exchange rate risk on exports. Based on a flexible...
Persistent link: https://www.econbiz.de/10011638802
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Over the last decade, German multinationals created about two million jobs abroad with increasing foreign direct investment (FDI). While there are many reasons for firms to go multinational and probably just as many for Germany's high unemployment, this paper aims to investigate the relationship...
Persistent link: https://www.econbiz.de/10003525926
This paper empirically analyzes the impact of exchange rate uncertainty, exchange rate movements and expectations on foreign direct investment (FDI). Two competing specifications of exchange rate volatility are examined. The investigation is based on a cross-section time-series data set of U.S....
Persistent link: https://www.econbiz.de/10012720611