Real Exchange Rate Volatility and the Price of Nontradables in Sudden-Stop-Prone Economies

Author/creator Mendoza, Enrique G. Author
Format Electronic
Publication InfoWashington : International Monetary Fund
Description64 p.
Supplemental ContentFull text available from Ebook Central - Academic Complete
Supplemental ContentFull text available from NBER Working Papers

Summary Annotation This paper shows that the dominant view that the high variability of real exchange rates is due to movements in exchange rate-adjusted prices of tradable goods does not hold for Mexican data for periods with a managed exchange rate. the relative price of nontradables accounts for up to 70 percent of real exchange rate variability during these periods. the paper also proposes a model in which this fact, and the sudden stops that accompanied the collapse of Mexico's managed exchange rates, could result from a Fisherian debt-deflation mechanism operating via nontradables prices in economies with dollarized liabilities.
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Technical detailsMode of access: World Wide Web
Genre/formElectronic books.
ISBN9781451908831
ISBN1451908830 (E-Book) Active Record
Stock number00013468

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