Access

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If You Use a Screen Reader

This content is available through Read Online (Free) program, which relies on page scans. Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.

Fundamentals of Real Exchange Rate Determination: What Role in the Peso Crisis?

Arne Kildegaard
Estudios Económicos
Vol. 21, No. 1 (41) (Jan. - Jun., 2006), pp. 3-22
Published by: El Colegio de Mexico
Stable URL: http://www.jstor.org/stable/40311508
Page Count: 20
  • Read Online (Free)
  • Download ($19.00)
  • Subscribe ($19.50)
  • Cite this Item
Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Fundamentals of Real Exchange Rate Determination: What Role in the Peso Crisis?
Preview not available

Abstract

Se investiga el papel desempeñado por factores estructurales en el comportamiento histórico del tipo de cambio real en México. Se demuestra que determinantes "fundamentales" (que se omitieron en investigaciones anteriores) son cointegrados con el tipo de cambio nominal y los precios relativos, mientras una prueba de la versión sencilla de PPA (sin los factores fundamentales) falla. La ecuación de cointegración indica una subvaluación severa a finales de los 1980s y una sobrevaluación ligera antes de la devaluatión de diciembre de 1994. Los factores fundamentales no son capaces de explicar la magnitud del choque que recibió México en aquel momento. /// We examine the role of structural factors in the Mexican real exchange rate experience since 1970, particularly in the crisis of December, 1994. We find that "fundamental" determinants of the real exchange—omitted from previous research—are cointegrated with nominal exchange rates and relative prices, while tests of PPP alone fail. The cointegrating equation indicates a severe undervaluation during the 1980s and only modest overvaluation in the period immediately preceding the devaluation in December, 1994. Nothing in the fundamentals can account for magnitude of the blow Mexico suffered at that time.

Page Thumbnails

  • Thumbnail: Page 
3
    3
  • Thumbnail: Page 
4
    4
  • Thumbnail: Page 
5
    5
  • Thumbnail: Page 
6
    6
  • Thumbnail: Page 
7
    7
  • Thumbnail: Page 
8
    8
  • Thumbnail: Page 
9
    9
  • Thumbnail: Page 
10
    10
  • Thumbnail: Page 
11
    11
  • Thumbnail: Page 
12
    12
  • Thumbnail: Page 
13
    13
  • Thumbnail: Page 
14
    14
  • Thumbnail: Page 
15
    15
  • Thumbnail: Page 
16
    16
  • Thumbnail: Page 
17
    17
  • Thumbnail: Page 
18
    18
  • Thumbnail: Page 
19
    19
  • Thumbnail: Page 
20
    20
  • Thumbnail: Page 
21
    21
  • Thumbnail: Page 
22
    22