Replication data for: The Dynamic Behavior of the Real Exchange Rate in Sticky Price Models
Principal Investigator(s): View help for Principal Investigator(s) Jón Steinsson
Version: View help for Version V1
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| 20070484_Data_and_Programs | 10/12/2019 08:18:AM | ||
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text/plain | 14.6 KB | 10/12/2019 04:18:AM |
Project Citation:
Steinsson, Jón. Replication data for: The Dynamic Behavior of the Real Exchange Rate in Sticky Price Models. Nashville, TN: American Economic Association [publisher], 2008. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113237V1
Project Description
Summary:
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Existing empirical evidence suggests that real exchange rates exhibit hump-shaped dynamics. I show that this is a robust fact across nine large, developed economies. This fact can help explain why sticky price business cycle models have been unable to match the persistence of the real exchange rate. I show that, in response to a number of different real shocks, a two-country sticky price business cycle model yields hump-shaped dynamics for the real exchange rate. The hump-shaped dynamics generated by the model are a powerful source of endogenous persistence that allows the model to match the long half-life of the real exchange rate. (JEL F31)
Scope of Project
JEL Classification:
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E31 Price Level; Inflation; Deflation
E32 Business Fluctuations; Cycles
F31 Foreign Exchange
E31 Price Level; Inflation; Deflation
E32 Business Fluctuations; Cycles
F31 Foreign Exchange
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