## Abstract As the real exchange rate of developing countries is especially vulnerable to stochastic events, standard unit root tests do not capture such events adequately. Using a Markov switching extension of the ADF test, which incorporates stochastic regime switching, we address the issue of re
โฆ LIBER โฆ
Real Exchange Rates in Transition Countries
โ Scribed by Mihail Petkovski
- Publisher
- Springer
- Year
- 2006
- Tongue
- English
- Weight
- 206 KB
- Volume
- 13
- Category
- Article
- ISSN
- 1614-4007
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## ABSTRACT This article examines the behaviour of the real exchange rates for 18 transition economies using nonlinear models. We find strong evidence of nonlinearities in 16 of the 18 countries. Contrary to widely held belief that the behaviour of real exchange rates should exhibit symmetrical adj