On the Equality of Real Interest Rates Across Borders in Integrated Capital Markets

A. Patrick L. Minford and David A. Peel

No 5611, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The purpose in this letter is first to review briefly the empirical results on the relationship between real interest rates and real exchange rates; this empirical literature provides little support for the hypothesis of Roll that expected real interest rates are equal in general. Our second aim is to discuss the theoretical conditions that have to be met for his hypothesis to hold.

Keywords: real exchange rates; real interest rates; roll (search for similar items in EconPapers)
JEL-codes: C22 C51 F31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-fmk and nep-ifn
Date: 2006-04
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Related works:
Working Paper: On the equality of Real Interest Rates across borders in Integrated Capital Markets (2005)
Journal Article: On the Equality of Real Interest Rates Across Borders in Integrated Capital Markets (2007)
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