To what Extent is the Chinese Renminbi Undervalued? A Two-Country Model of Monopolistic Competition - Quanto è sottovalutato il Renminbi cinese? Un modello a due paesi di concorrenza monopolistica

Hui-Kuan Tseng
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Hui-Kuan Tseng: University of North Carolina, Department of Economics, Postal: 9201 University City Blvd, Charlotte, NC - USA, http://www.uncc.edu/

Economia Internazionale / International Economics, 2012, vol. 65, issue 4, 623-636

Abstract: Contrast to the BEER, PEER and FEER approaches, this paper develops a two-country model of monopolistic competition to re-examine whether the Chinese Renminbi is undervalued and to what extent it is undervalued. A testable equation that governs the equilibrium exchange rate of Renminbi is derived. Based on US-China data on relative wage rates and relative real GDP, the numerical simulations suggest that relative to the US dollar, the Chinese currency is about 12.4% undervalued for the year of 2011. - In contrasto con gli approcci BEER, PEER e FEER, questo lavoro sviluppa un modello a due paesi di concorrenza monopolistica per riesaminare se il Renminbi è sottovalutato e di quanto. Viene specificata un’equazione che governa il tasso di cambio di equilibrio del Renminbi. Sulla base dei dati USA-Cina sui salari relativi e sui PIL reali relativi, le simulazioni numeriche suggeriscono che nell’anno 2011 la valuta cinese è stata sottovalutata di circa il 12,4% rispetto al dollaro USA.

Keywords: Chinese Renminbi; Monopolistic Competition (search for similar items in EconPapers)
JEL-codes: F16 F31 F41 (search for similar items in EconPapers)
Date: 2012
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