国际经济学萨尔瓦多第十五章.ppt

FIGURE 15-5 (continued) When U.S. money supply unexpectedly increases by 10%. The only way that we can expect the dollar to appreciate in the future and still end up with a net depreciation of 10% in the long run is for the dollar immediately depreciates by more than 10%, we call it exchange rate overshooting. 15.6 Empirical Tests of the Monetary and Asset Market Models and Exchange Rate Forecasting Empirical tests do not provide much support for the monetary and the asset market or portfolio balance models, except in the long run. Short-run exchange rates have defied all attempts at accurate forecasting. One reason for this is the importance of news which can not be predicted. Another reason is the existence or development of speculative bubbles, which often move exchange rates away from fundamentals. Problems 1, 3, 7. Problems 9, 11, 12. * Chapter 15 Exchange Rate Determination 15.1 Introduction 15.2 Purchasing-Power Parity Theory 15.3 Monetary Approach to the Balance of Payments and Exchange Rates 15.4 Asset Market Model and Exchange Rates 15.5 Exchange Rate Dynamics 15.6 Empirical Tests of the Monetary and the Assets Market Models and Exchange Rate Forecasting 15.2 Purchasing-Power Parity Theory 15.2A Absolute Purchasing-Power Parity Theory The absolute purchasing-power parity theory postulates that the equilibrium exchange rate between two currencies is equal to the ratio of the price levels in the two nations. R=P/P* R is the exchange rate or spot rate, P and P* are respectively the general price level in the home nation and in the foreign nation. Law of one price means a given commodity should have the same price in both nations when expressed in terms of the same currency. However, this version of the PPP theory can be misleading. Firstly, it appears to give the exchange rate that equilibrates trade in goods and services while completely disregarding the capital account. Secondly, this version of the PPP theory will not even gi