In 1995, Mexico introduced a price-level-adjusting unit of account called the Unidad de Inversion (UDI). Loans denominated in UDIs maintain their purchasing power and provide a real rate of return in pesos. This study examines the real rate of return earned by dollar investors in UDI mortgages...

In this paper, a series of empirical tests are conducted comparing the explanatory power of the neoclassical approach (in particular, purchasing power parity and the monetary model) with that of a long-run exchange rate model based on Post Keynesian premises (the tests use annual data for the...

In 1995, Mexico introduced a credit system based on a price-level-adjusting unit of account called the Unidad de Inversion (UDI, pronounced “oo-deeâ€), which is Spanish for “unit of investment.†The Bank of Mexico maintains an UDI Index, which sets the peso value of an UDI on...