The main purpose of this thesis is to explore whether the Balassa-Samuelson hypothesis can effectively explain the long-term change of the real exchange. The recent panel unit root, panel cointegration tests and fully modified OLS are applied to examine the four tested equations that are based on the Balassa-Samuelson hypothesis. The data span is from 1985 to 2002, and includes 7 east asian countries.
1. Relative differential productivity between traded and non-traded sectors influences price differential in two sectors.
2. We extend the relative productivity in non-traded and traded sectors causing change in non-traded relative price into the two-country model.
3. The appreciation (depreciation) of the real exchange results from the different relative price of the two-country model.
4. The appreciation (depreciation) of the real exchange is caused by the different relative productivity of the two-country model.
Finally, we can observe from the results of the empirical study: when productivity of the domestic sectors differentiates, that is, 1% increase in relative productivity between traded and non-trade sectors causes 0.28% increase in domestic relative prices. When it is taken into the two-country model, the increase of productivity will cause the appreciation of the real exchange rate.
| Identifer | oai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0131105-133927 |
| Date | 31 January 2005 |
| Creators | chi, chia |
| Contributors | none, none, none |
| Publisher | NSYSU |
| Source Sets | NSYSU Electronic Thesis and Dissertation Archive |
| Language | Cholon |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0131105-133927 |
| Rights | not_available, Copyright information available at source archive |
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