Bravo-Ortega, Claudio; Giovanni, Julian di - In: IMF Staff Papers 53 (2006), pp. 6-6
This paper examines the impact of trade costs on real exchange rate volatility. The relationship is examined by constructing a two-country Ricardian model of trade, based on the work of Dornbusch, Fischer, and Samuelson (1977), which shows that higher trade costs result in a larger nontradables...