The Political Economics Side of the J-Curve

António Caleiro

Economics Working Papers from University of Évora, Department of Economics (Portugal)

Abstract: About twenty years ago, an article by van der Ploeg analysed the implications of the J-curve effect for the political business cycle in a small open economy [van der Ploeg (1989c)]. It was then shown that a sudden jump on the exchange rates in the election day should be observed if the government, in order to maximise its popularity, explores a J-curve effect. As a way of celebrating this work, that should have been more influential, it is presented in the paper a simulation study, which confirms that exchange rate overvaluation result a la van der Ploeg.

Keywords: Exchange rates; J-Curve; Partisan Business Cycles; Political Business (search for similar items in EconPapers)
JEL-codes: E31 E32 F31 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2008
New Economics Papers: this item is included in nep-cba, nep-hpe, nep-ifn, nep-mac and nep-pol
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http://hdl.handle.net/10174/8454 (text/html)

Related works:
Journal Article: The Political Economics Side of the J-Curve (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:evo:wpecon:02_2008

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