Skip to main content
Article thumbnail
Location of Repository

Sources of Exchange Rate Movements in Japan: Is the Exchange Rate a Shock-Absorber or a Source of Shock?

By Lian An and Yoonbai Kim


This paper investigates the sources of movements of the yen-dollar exchange rate using a structural vector autoregression (VAR) with a combination of short-run and long-run zero restrictions. We find that real shocks dominate nominal shocks in explaining the exchange rate movements, with relative real demand shocks as the major contributor. The exchange rate market does not seem to be a major source of disturbances to the Japanese economy. The overall results support the view that the bilateral dollar exchange rate in Japan is a shock-absorber rather than a source of shocks. Copyright � 2010 Blackwell Publishing Ltd.

DOI identifier: 10.1111/j.1467-9396.2010.00853.x
OAI identifier:
Download PDF:
Sorry, we are unable to provide the full text but you may find it at the following location(s):
  • http://www.blackwell-synergy.c... (external link)
  • Suggested articles

    To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.