Real Shocks and the Real Exchange Rate

Emil-Maria Claassen
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Emil-Maria Claassen: University of Paris-Dauphine

Chapter 7 in Open-Economy Macroeconomics, 1993, pp 137-152 from Palgrave Macmillan

Abstract: Abstract The real exchange rate is measured as the relative price of domestic tradables either with respect to foreign tradables or with respect to non-tradables. It can be influenced by monetary and real shocks. Monetary disturbances produce temporary changes in the real exchange rate as an outcome of the asymmetry in the speed of adjustment in the goods and asset markets. Real shocks defined as exogenous disturbances of supply or demand in the goods market can affect the real exchange rate permanently.

Keywords: Current Account; Real Exchange Rate; Trade Balance; Nominal Exchange Rate; Current Account Balance (search for similar items in EconPapers)
Date: 1993
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DOI: 10.1007/978-1-349-12884-6_7

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