Title: Whither the Yen? Implications of an Intertemporal Model of the Dollar/Yen Rate
Abstract: This article documents the evidence for a fiscal model of the dollar/yen real exchange rate over the period 1974–1995. Cointegrating relationships between the real exchange rate and productivity, government spending, and the real price of oil are estimated using the Johansen (1988) and Stock–Watson (1993) procedures. The neoclassical fixed-factors fiscal model of Rogoff (1992) is found to have some substantiation in the data. Estimates of the long-run equilibrium exchange rate indicate an overvaluation of approximately 16% at an exchange rate of 85 yen to the dollar in mid-1995.J. Japan. Int. Econ., June 1997,11(2), pp. 228–246. Department of Economics, University of California, Santa Cruz, California 95064.
Publication Year: 1997
Publication Date: 1997-06-01
Language: en
Type: article
Indexed In: ['crossref']
Access and Citation
Cited By Count: 14
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot