We use a spatial competition based model in a two-stage game setup to assess whether equilibrium in exchange rates among the leading currencies is attainable. We show that a stable equilibrium can be reached in the case of two leading currencies, but not in the case of three. In our model,...

In this paper, we evaluate what we have learned to date about the effects of privatization from the experiences during the last fifteen to twenty years in the postcommunist (transition) economies and, where relevant, China. We distinguish separately the impact of privatization on efficiency,...

In this book several econometrics techniques are used to perform quantitative research of the exchange rate in transition. This is an empirical work based on related economic theory. While the stress is put on the exchange rate of the Czech koruna, the subject is analyzed from a broader...

We address the issue of foreign exchange risk and its macroeconomic determinants in several new EU members. The joint distribution of excess returns in the foreign exchange market and the observable macroeconomic factors is modeled using the stochastic discount factor (SDF) approach and a...

We address the issue of foreign exchange risk and its macroeconomic determinants in several new EU members. The joint distribution of excess returns in the foreign exchange market and the observable macroeconomic factors is modeled using the stochastic discount factor (SDF) approach and a...

A conditional variance analysis is applied to study the exchange rate of the Czech crown. The crown is pegged to a currency basket with an imposed narrow band. The central bank’s consistent policy enables the semi-fixed exchange rates to behave similarly to free ones. Their movements exhibit...

This paper investigates the question of whether there exists evidence in support of inflation convergence within the European Union. The analysis also focuses on whether the Exchange Rate Mechanism (ERM) helped to accelerate inflation convergence in its member countries. The results of this...

This paper extends and generalizes the BDS test presented by Brock, Dechert, Scheinkman, and LeBaron (1996). In doing so it aims to remove the limitation of having to arbitrarily select a proximity parameter by integrating across the correlation integral. The Monte Carlo simulation is used to...

Privatization in the Czech Republic was carried out under three programs: restitution, small privatization and large privatization. By far the most important privatization program in the Czech Republic was large-scale privatization that began in the spring of 1991. Large privatization allowed...

In the presence of the underground economy taxes give rise to a deadweight loss from displacement of efficient producers by inefficient producers. We consider an economy in which a producer faces two types of costs: the cost of production, and taxes. If the ability to evade taxes is inversely...