Zhang, Zhibai (2010): Understanding the behavioral equilibrium exchange rate model via its application to the valuation of Chinese renminbi.
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In this paper, the behavioral equilibrium exchange rate (BEER) model used in a time-series setting is investigated, via its application to the valuation of Chinese renminbi. A classical definition with its generalization is given. The different misalignment results derived from the BEER models are proven to result from the different econometric component choices. It is found that some of the misalignment results are consistent with Chinese economic facts, but some others are not. Finally, four main flaws unavoidable under the BEER model are given and analyzed.
|Item Type:||MPRA Paper|
|Original Title:||Understanding the behavioral equilibrium exchange rate model via its application to the valuation of Chinese renminbi|
|Keywords:||Behavioral equilibrium exchange rate; Chinese renminbi|
|Subjects:||F - International Economics > F3 - International Finance > F31 - Foreign Exchange|
|Depositing User:||Zhibai Zhang|
|Date Deposited:||14. Aug 2012 04:36|
|Last Modified:||16. Feb 2013 00:39|
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