1998 Fiscal Year Final Research Report Summary
Theory and Empirical Study on the Mechanism of the Determination of Real Exchange Rate
| Project/Area Number |
09630015
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
経済理論
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| Research Institution | Aoyama Gakuin University |
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Principal Investigator |
NARITA Junji Dep.of Economics, Aoyama Gakuin Univ., Associate Pro., 経済学部, 助教授 (00133695)
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| Co-Investigator(Kenkyū-buntansha) |
AMAO Hisao Dep.of Management, Sakushingakuin Univ., Lecturer, 経営学部, 講師 (40275772)
NAGATA Masahiro Fac.of Liberal Arts, Saitama Univ., Professor, 教養学部, 教授 (50261871)
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| Project Period (FY) |
1997 – 1998
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| Keywords | exchange rate / real exchange rate. / tradable and non-tradable goods / monetary policy / de-regulation / differences of domestic and foreign price |
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| Research Abstract |
The following three studies were wade by us :
(1) Study about the productivity gap between tradable and non-tradable industries and the real exchange rate.
With a special note on the gap of productivity between the tradable and non-tradable industries of Japan and the U.S., analysis was wade on the trend of the real exchange rate.
(2) Monetary policy of Japan and Korea and its correlation to currency exchange rate
Existence of a reverse correlation in the growth rate of money supply in Japan and Korea was identified, and its mechanism was clarified. This may be explained as follows : Korea has traditionally linked its currency won to dollar. As the volume of export from Japan is reduced (increased) due to stronger (weaker) yen, export of Korean goods in competition with those in Japan increases (decreases) and the Korean economy turns better (worse). Freedom of capital mobility increased for Korea in 1990's and Korea is believed to be in need to tighten or relax money supply for stabilization of macroeconomy.
(3) Macroeconomic impact of de-regulation on the differences of domestic and foreign prices
Analysis was made as to how much de-regulation might reduce the differences of Japanese prices and the U.S.prices. The relative prices of non-tradable goods against tradable goods in its narrow definition such as wachinery have become higher in such fields as construction, real estate, and transportation, while they have become smaller in trend in such fields as finance or insurance. In order to estimate the impact of the price differences of Japan and the U.S.as de-regulation further proceeds in Japan to the extent of the U.S., quantitative analyses were wade with some assumptions. The result indicates that the macroeconomic effect of the de-regulation is not sosignificant enough as to attribute lack of the de-regulation as the main cause of the price differences between Japan and the U.S.
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