Productivity bias hypothesis claims that deviation of the PPP based exchange rate from the equilibrium rate is mainly due to productivity differentials among countries. Early studies that employed cross-sectional data in testing the hypothesis provided mixed results. A few time-series studies...

The literature on the impact of devaluation on domestic production includes many studies that have used aggregate output data such as real GDP. A few recent studies have began looking at the response of sectoral output to currency depreciation. In this paper we consider eight sectors of the U.S....

Many of the previous studies that tried to assess the contractionay or expansionary effects of depreciations or devaluations in less developed countries (LDCs) used official exchange rate data and concluded that devaluations are contractionary in LDCs. However, due to capital controls, there is...

Many of the previous studies that tried to assess the contractionay or expansionary effects of depreciations or devaluations in less developed countries (LDCs) used official exchange rate data and concluded that devaluations are contractionary in LDCs. However, due to capital controls, there is...