Scandinavian Working Papers in Economics

Working Paper Series,
Trade Union Institute for Economic Research

No 180: The Swedish Real Exchange Rate under Different Currency Regimes

Anna Larsson ()
Additional contact information
Anna Larsson: Department of Economics, Stockholm University and, Postal: FIEF, Wallingatan 38, SE-111 24 Stockholm, Sweden

Abstract: This paper presents evidence on the behavior of the Swedish real exchange rate relative to Germany under different currency regimes 1973:1-2001:4. The results suggest that the real exchange rate is cointegrated with Swedish and German productivity, which is consistent with Balassa (1964) and Samuelson (1964). In the short run, the regime has mattered for the dynamics of the real exchange rate. Deviations from equilibrium have been adjusted more quickly when the nominal exchange rate has been allowed to float freely, which indicates that it acts as a shock absorber.

Keywords: Real exchange rate; Exchange rate regimes; Cointegration

JEL-codes: C22; E31; F41

29 pages, First version: November 11, 2002. Revised: September 18, 2003.

Note: This paper is a considerably revised version of my master thesis written at Stockholm University.

Full text files

WP180.pdf PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Sune Karlsson ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2024-02-05 17:11:11.