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Publication Type
Book Chapter
UWI Author(s)
Author, Analytic
Ghartey, Edward, E
Author Affiliation, Ana.
Department of Economics
Title, Analytic
The monetary approach to determine the exchange rate in the Caribbean
Medium Designator
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Connective Phrase
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Author, Monographic
Meijer, G.; Heijman, W.J.M.; Van Ophem, J.A.C.; Verstegan, B.H. J.
Author Role
Editors
Title, Monographic
The Maastricht ISINI-papers
Reprint Status
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Edition
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Place of Publication
Maastricht
Publisher Name
Shaker Publishing BV
Date of Publication
2000
Volume ID
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Issue ID
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Page(s)
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Series Editor
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Series Editor Role
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Series Title
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Series Volume Identification
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Series Issue Identification
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Location/URL
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Notes
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Abstract
Examines seasonal integration and co-integration in Barbados, Jamaica and Trinidad and Tobago. There is a seasonal unit root at the long-run for all the countries, except Barbados where the unit root is found only in the case without a deterministic component for an exchange rate. The order of integration is found to unity for all the countries, except the exchange rate variable for Barbados which is zero. The exchange rate exhibits random walk behaviour in all the countries, except for Barbados. The Granger test shows relative monies causing an exchange rate only in Jamaica, however, the error correction estimates show causality in both Barbados and Jamaica. Thus, the foreign exchange market weak-form efficient in Jamaica, semi-strong form efficient in Trinidad Tobago, and semi-strong form inefficient in Barbados. The foreign exchange policy emerging from the study, supports a fixed exchange rate regime for Barbados, dirty floating for Jamaica with money supply as the policy instrument, and clean floating for Trinidad Tobago.....
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