Capital Account Policies and the Real Exchange Rate
Published Date
Copyright 2013
ISBN 978-0-226-05313-4
DOI 10.1086/669583
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This paper presents a simple model of how a small open economy can undervalue its real exchange rate using its capital account policies. The paper presents several properties of such policies, and proposes a rule of thumb to assess their welfare cost. The model is applied to an analysis of Chinese capital account policies.
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This paper presents a simple model of how a small open economy can undervalue its real exchange rate using its capital...