Capital-enhanced equilibrium exchange rate: evidence from India

Prabheesh, K P and Garg, B (2018) Capital-enhanced equilibrium exchange rate: evidence from India. Applied Economics Letters. pp. 1-5. ISSN 1350-4851 (In Press)

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Abstract

This article examines the validity of the capital-enhanced equilibrium exchange rate (CHEER) approach using quarterly data ranging from 1993Q1 to 2016Q2. Using unit root break test and structural break cointegration technique, our overall results indicated that the CHEER is invalidated once a structural break is accounted for in the cointegration relationship. The rejection of the validity could be attributed to the asymmetry in the capital flows and exchange rates being not fully flexible

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IITH Creators:	IITH Creators ORCiD Prabheesh, K P UNSPECIFIED Garg, B UNSPECIFIED
Item Type:	Article
Uncontrolled Keywords:	cointegration, exchange rate, interest rate differentials, Purchasing power parity, structural breaks
Subjects:	Social sciences > Political Science & Economics
Divisions:	Department of Liberal Arts
Depositing User:	Team Library
Date Deposited:	13 Feb 2018 09:50
Last Modified:	13 Feb 2018 09:50
URI:	http://raiithold.iith.ac.in/id/eprint/3777
Publisher URL:
Related URLs:	Google Scholar

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