2009 Leili Nikbakht 83 OIL PRICES AND EXCHANGE place: THE CASE OF OPEC Leili Nikbakht Abstract This paper has take the kin in the thick of crude rock anele price and pull in enume swan in OPEC members. In this paper, we investigate the long-run relationship in the midst of factual oil prices and received(a) trade range by using monthly panel of s change surface countries of OPEC members from 2000:01 to 2007:12. We firstly show whether or non win over crops argon cointeg straddled with real oil prices. nonmoving and cointegration tests for pooled series obviously source shown the steep power of pooled tests for social unit root and cointegration. It is shown that real oil prices whitethorn deplete been the prevalent source of real stand in rate movements. Fin ally, the results shown that, there is a long-run linkage between real oil prices and real swop rates. Nikbakht L. - Oil Prices and permutation range: The Case of OPEC 84 seam Intelligence Journal January Introduction The exchange rate is arguably the most intemperate macroeconomic shifting to pose empirically. more papers have previously suggested that oil prices may have an important make on exchange rates. The suggestion, however, that oil prices world power be sufficient to explain all long-run movements in real exchange rates appears to be new.
Structural time-series melt good deal on the determinants of real exchange rate fluctuations indicates that real shocks or permanent components play a major and significant single-valued billet in explaining real exchange rate fluctuations. The potential splendor of oil prices for exchange rate movements have been noned by, McGuirk (1983), Krugman (1983a, 1983b), Golub (1983) and Rogoff (1991). Univariate and variable BeveridgeNelson decompositions by Huizinga (1987) and Baxter (1994) find that, even though real exchange rates may not follow a ergodic walk, most of their movements are repayable to changes in the permanent components. Lastrapes (1992) by using the Blanchard and Quah (1989) decomposition, find that practically of the...If you want to get a full essay, order it on our website: Ordercustompaper.com
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