Logo
Munich Personal RePEc Archive

Foreign capital and exchange rate movement in developing economies: a theoretical note

Biswas, Anindya and Mandal, Biswajit and Saha, Nitesh (2013): Foreign capital and exchange rate movement in developing economies: a theoretical note.

[img]
Preview
PDF
MPRA_paper_52468.pdf

Download (156kB) | Preview

Abstract

This study attempts to provide with underlying theoretical explanations for exchange rate appreciation due to foreign capital inflow. We use an extended three sector specific factor model to explain why and how an inflow of foreign capital boosts the price of a nontradable good that helps tilting the exchange in rate in favor of the host country. We also strive to look at the possible consequences on factor prices and on sectoral de-composition of a representative economy.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.