The Effect of Unemployment Insurance on Unemployment Duration.

This paper shows that unemployment insurance benefits could decrease the expected duration of unemployment induced by search. An unemployed person who has to fin ance search from limited resources may use the benefits to intensify search effort and lower the expected duration of employment. Copyright 1987 by University of Chicago Press.

The Behavior of Foreign Exchange Rates

The analysis of the distribution of foreign exchange rate changes provides a description of the behavior of foreign exchange rates and its determining underlying process. The application of empirical methodologies or further theoretical developments is limited by the nature of this distribution. In this paper, the empirical analysis of major currencies during the flexible exchange rate period suggests that there is no unique distribution representing the behavior of the foreign exchange rate. This, however, is determined both by foreign exchange management policies and the fundamental economic forces.© 1982 JIBS. Journal of International Business Studies (1982) 13, 99–111

The Behavior of Foreign Exchange Rates – Reply

In the preceding Comment on our JIBS paper [1], three basic claims are made:The results in [1] are contrary to those reported elsewhere. The contradiction may be due to certain weakness in the methodology employed by us.Based on a “direct approach” three currencies (out of the fourteen we analyzed) are regrouped:two (the Australian dollar, and Japanese yen) from Group III into Group I (currencies with a symmetric distribution), and one (the Italian lira) from Group III into Group II (currencies close to have a symmetric distribution except for at least 1 subperiod); andThat the arguments presented by us concerning the effects of foreign exchange management policy on exchange rates “are no longer supported by the data”.© 1986 JIBS. Journal of International Business Studies (1986) 17, 177–180