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Article: The effects of government spending on real exchange rates: Evidence from military spending panel data

TitleThe effects of government spending on real exchange rates: Evidence from military spending panel data
Authors
KeywordsMilitary spending
Fiscal policy
Real exchange rates
Twin deficit
Risk sharing
Issue Date2019
PublisherElsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/jie
Citation
Journal of International Economics, 2019, v. 116, p. 144-157 How to Cite?
AbstractUsing panel data on military spending for 125 countries, we document new facts about the effects of changes in government purchases on the real exchange rate, consumption, and current accounts in both advanced and developing countries. While an increase in government purchases causes real exchange rates to appreciate and increases consumption significantly in developing countries, it causes real exchange rates to depreciate and decreases consumption in advanced countries. The current account decreases in both groups of countries. These findings are not consistent with standard international business cycle models. We discuss potential sources of the differences between advanced and developing countries in the responses to spending shocks.
Persistent Identifierhttp://hdl.handle.net/10722/274516
ISSN
2017 Impact Factor: 2.168
2015 SCImago Journal Rankings: 3.723
ISI Accession Number ID

 

DC FieldValueLanguage
dc.contributor.authorMiyamoto, W-
dc.contributor.authorNguyen, T-
dc.contributor.authorSeremirov, V-
dc.date.accessioned2019-08-18T15:03:14Z-
dc.date.available2019-08-18T15:03:14Z-
dc.date.issued2019-
dc.identifier.citationJournal of International Economics, 2019, v. 116, p. 144-157-
dc.identifier.issn0022-1996-
dc.identifier.urihttp://hdl.handle.net/10722/274516-
dc.description.abstractUsing panel data on military spending for 125 countries, we document new facts about the effects of changes in government purchases on the real exchange rate, consumption, and current accounts in both advanced and developing countries. While an increase in government purchases causes real exchange rates to appreciate and increases consumption significantly in developing countries, it causes real exchange rates to depreciate and decreases consumption in advanced countries. The current account decreases in both groups of countries. These findings are not consistent with standard international business cycle models. We discuss potential sources of the differences between advanced and developing countries in the responses to spending shocks.-
dc.languageeng-
dc.publisherElsevier BV. The Journal's web site is located at http://www.elsevier.com/locate/jie-
dc.relation.ispartofJournal of International Economics-
dc.subjectMilitary spending-
dc.subjectFiscal policy-
dc.subjectReal exchange rates-
dc.subjectTwin deficit-
dc.subjectRisk sharing-
dc.titleThe effects of government spending on real exchange rates: Evidence from military spending panel data-
dc.typeArticle-
dc.identifier.emailMiyamoto, W: wataru@hku.hk-
dc.identifier.authorityMiyamoto, W=rp02409-
dc.description.naturelink_to_subscribed_fulltext-
dc.identifier.doi10.1016/j.jinteco.2018.11.009-
dc.identifier.scopuseid_2-s2.0-85057750932-
dc.identifier.hkuros301176-
dc.identifier.hkuros301170-
dc.identifier.volume116-
dc.identifier.spage144-
dc.identifier.epage157-
dc.identifier.isiWOS:000458596300009-
dc.publisher.placeNetherlands-

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