Real exchange rate movements in developed and developing economies: a reinterpretation of the Balassa-Samuelson hypothesis

Dumrongrittikul, Taya (2012) Real exchange rate movements in developed and developing economies: a reinterpretation of the Balassa-Samuelson hypothesis. Economic Record, 88 283: 537-553. doi:10.1111/j.1475-4932.2012.00830.x


Author Dumrongrittikul, Taya
Title Real exchange rate movements in developed and developing economies: a reinterpretation of the Balassa-Samuelson hypothesis
Journal name Economic Record   Check publisher's open access policy
ISSN 0013-0249
1475-4932
Publication date 2012-12-01
Sub-type Article (original research)
DOI 10.1111/j.1475-4932.2012.00830.x
Open Access Status Not Open Access
Volume 88
Issue 283
Start page 537
End page 553
Total pages 17
Place of publication Richmond, VIC Australia
Publisher Wiley-Blackwell Publishing Asia
Language eng
Abstract This article applies panel-data techniques to examine the Balassa-Samuelson hypothesis (BSH) for 33 countries. We introduce a new approach for classifying traded and non-traded industries which allows for country-specific heterogeneity over each industry and changes in classifications across periods. We find that in developed countries, productivity growth in traded goods leads to a real depreciation of the currency, inconsistent with the BSH; however, higher growth countries experience real appreciation. The results of developing countries support the BSH in that higher productivity growth in traded goods leads to real appreciation.
Q-Index Code C1
Q-Index Status Provisional Code
Institutional Status Unknown

Document type: Journal Article
Sub-type: Article (original research)
Collection: School of Economics Publications
 
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Created: Tue, 24 Nov 2015, 20:36:35 EST by Alys Hohnen on behalf of School of Economics