This paper examines the influence of the capital flows on the real exchange rate of the Romanian leu against euro. Many studies which are analysing the fundamental determinants of the exchange rate of the leu, show that the appreciation of the currency, before the financial crises from the last...

Using data since 1820 for the US, the UK and France, we test for the presence of real effects on the equilibrium real exchange rate (the Harrod-Balassa-Samuelson, HBS effect) in an explicitly nonlinear framework and allowing for shifts in real exchange rate volatility across nominal regimes. A...

This study estimated an error correction model of the impact of real effective exchange rate volatility on the performance of non-traditional exports for Zambia between 1965 and 1999. Using a generalized autoregressive conditional heteroscedasticity (GARCH) measure of real exchange rate...

We present a Structuralist-Keynesian theoretical approach on the determining factors of the real exchange rate for open emerging economies. Instead of macroeconomic fundamentals, the long-term trend of the real exchange rate level is better determined not only by structural forces and long-term...

This paper examines whether inflation targeting (IT) influences purchasing power parity (PPP) by a bias correction approach under cross-sectional dependence. The recursive mean adjustment (RMA) method proposed by So and Shin (1999) and Shin and So (2001) is employed to correct a downward bias...

The real exchange rate is one of the most important price variables in macroeconomics as changes in it have implications for both external competitiveness as well as internal sectoral resource allocation. This paper decomposes real exchange rate volatility into its two components for a panel of...

The application of the law of one price to the international market is purchasing power parity. Purchasing power parity associates the prices of all goods used in foreign trade with the exchange rate. If the purchasing power parity is valid, the changes in the nominal exchange rates balance the...

The application of the law of one price to the international market is purchasing power parity. Purchasing power parity associates the prices of all goods used in foreign trade with the exchange rate. If the purchasing power parity is valid, the changes in the nominal exchange rates balance the...

One of the most important and recurrent concept in international macroeconomics is Purchasing Power Parity (PPP) hypothesis. PPP has been used as a theory of domestic price determination under fixed exchange rate regime and a theory of exchange rate determination under flexible exchange rate...

The application of the law of one price to the international market is purchasing power parity. Purchasing power parity associates the prices of all goods used in foreign trade with the exchange rate. If the purchasing power parity is valid, the changes in the nominal exchange rates balance the...