Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/61270
Authors: 
Moersch, Mathias
Nautz, Dieter
Year of Publication: 
1998
Series/Report no.: 
Discussion Papers, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes 1998,6
Abstract: 
We emphasize the importance of properly identifying the long-run relations underlying the monetary model of the exchange rate. The separate estimation of long-run money demands leads to a 'structural' error correction equation which allows an interpretation of the various channels affecting the exchange rate in the monetary model. We apply this approach to the analysis of the DM/Dollar exchange rate where the structural model yields better results than various alternative forecast strategies, among them a random walk.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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