In this article we test the relationship between per capita income differential and exchange rate differential between two different economic background countries. Recent researches have been done on the testing of international Fisher effect, Interest rate, GDP growth rate and purchasing power...

The analysis of open macroeconomies typically assumes (implicitly or explicitly) that resource allocation decisions are taken by domestic agents. The Portfolio Theory of Inflation (PTI) developed in this study assumes that some critical allocation decisions are taken by global investors and...

The Portfolio Theory of Inflation (PIT) proposed in this study investigates the role of global financial markets in determining the effectiveness of macroeconomic policy in open and fully financial integrated economies. The PIT adopts a modified version of the portfolio balance approach to...

In this paper, I have investigated the out of sample forecast performance for a case study on the determination of the nominal exchange rate for USD vis-à-vis IN¬R under VEC, VAR (in first difference) and Bayesian VAR specification with the help of set of economic theories. The forecast...

This study empirically investigates the linkage between borrowing ability and exchange rate regimes in emerging market economies using the panel data from 1970-2016. The paper focuses on evaluating the borrowing ability as the measure of quantity and price. The key findings indicate that...

We develop an empirical model of exchange rate returns, applied separately to samples of developed (DM) and developing (EM) economies' currencies against the dollar. Monetary policy stance of the global central banks, measured via a natural-language-based approach, has a large effect on exchange...

This paper uses the impulse response from an estimated structural autoregressive model of the inflation process to estimate the dynamic exchange rate pass-through to consumer prices for Nigeria, using quarterly data for the period 1986-2010. The results suggest that the exchange rate...

This paper highlights some of the theoretical and practical implications for monetary policy and exchange rates that derive specifically from the presence of a global general equilibrium factor embedded in neutral real policy rates in open economies. Using a standard two country DSGE model, we...

This paper highlights some of the theoretical and practical implications for monetary policy and exchange rates that derive specifically from the presence of a global general equilibrium factor embedded in neutral real policy rates in open economies. Using a standard two country DSGE model, we...

We construct a model in which the real exchange rate is affected by the real interest rate and price differentials as well as real factors that cause shocks to the expected flexible-price equilibrium value of the real exchange rate. The model is then employed to test for the "generalized"...