Stock Prices, Real Exchange Rates, and Optimal Capital Accumulation.

This paper analyzes the dynamics of the real exchange rate and the price of equity for a small open economy using an optimizing model in which the process of capital accumulation entails adjustment costs. The analysis demonstrates that along an adjustment path toward long-run equilibrium, appreciati...

Ամբողջական նկարագրություն

Մատենագիտական մանրամասներ
Համատեղ հեղինակ: International Monetary Fund
Ձևաչափ: Ամսագիր
Լեզու:English
Հրապարակվել է: Washington, D.C. : International Monetary Fund, 1988.
Շարք:IMF Working Papers; Working Paper ; No. 1988/031
Առցանց հասանելիություն:Full text available on IMF
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110 2 |a International Monetary Fund. 
245 1 0 |a Stock Prices, Real Exchange Rates, and Optimal Capital Accumulation. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 1988. 
300 |a 1 online resource (34 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a This paper analyzes the dynamics of the real exchange rate and the price of equity for a small open economy using an optimizing model in which the process of capital accumulation entails adjustment costs. The analysis demonstrates that along an adjustment path toward long-run equilibrium, appreciation of the real exchange rate will accompany a decline in the market price of equity, whereas depreciation of the real exchange rate will accompany a rise in the price of equity. This relationship results from the requirement that non-traded inputs are used in the investment process. In the short-run, though, the effects on these variables depend critically on whether disturbances originate in the non-traded sector and on whether disturbances are perceived as temporary or permanent. The disturbances considered include changes in fiscal policies as well as changes in the world interest rate. 
538 |a Mode of access: Internet 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 1988/031 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/1988/031/001.1988.issue-031-en.xml  |z IMF e-Library