Christopulos, Dēmētrēs K.; Gente, Karine; … - 2010
savings, the RER only depends on productivity spread between sectors (Balassa-Samuelson effect). If the constraint is too … tight and/or domestic savings too low, the RER depends on both net foreign assets (transfer effect) and productivity. We … then analyze the empirical implications of the model and find that, in accordance with the theory, the RER is mainly driven …