The Mechanisms and What can be Done about Them — a Close Look

Richard Friberg
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Richard Friberg: Stockholm School of Economics

Chapter 9 in Exchange Rates and the Firm, 1999, pp 57-100 from Palgrave Macmillan

Abstract: Abstract After the focus on contractual exposure in Chapter 8 we now return to the question of economic exposure. It would have to be a very brave, or foolish, businessman that built strategy on results from regressions such as those in Chapter 7 above, without understanding the underlying mechanisms. This point is of course not new: for instance Coppé et al. (1996) stress that ‘Companies need to understand — not just correlate — the relationship between foreign exchange movements and cashflows.’ This is not to say that statistical analysis is pointless — it can serve as a valuable complement to economic analysis.

Keywords: Exchange Rate; Foreign Direct Investment; Switching Cost; Real Exchange Rate; Price Discrimination (search for similar items in EconPapers)
Date: 1999
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-333-98237-2_9

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DOI: 10.1057/9780333982372_9

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