The Impact of Output and Exchange Rate Volatility on Fixed Private Investment: Evidence from Selected G7 Countries

Authors

Abdur Chowdhury, Marquette UniversityFollow
Mark Wheeler, Western Michigan University

Document Type

Article

Language

eng

Format of Original

14 p.; 25 cm

Publication Date

2015

Publisher

Taylor & Francis (Routledge)

Source Publication

Applied Economics

Source ISSN

0003-6846

Abstract

This study examines the impact of shocks to exchange rate and output uncertainty (volatility) on real private fixed investment (FI) in Canada, Germany, the United Kingdom and the United States. The analysis is conducted using vector autoregressive models that contain the price level, real output, the volatility of real output, the real exchange rate, the volatility of the real exchange rate, an interest rate and FI. The results yield important public policy implications with regard to the impact of output volatility of FI. Our analysis indicates that volatility shocks, measured as output volatility or exchange rate volatility, do not have a significant impact on FI for any country in our study.

Comments

Accepted version. Applied Economics, Vol. 47, No. 25 (2015): 2628-2641. DOI. © 2015 Taylor and Francis (Routledge). Used with permission.

Recommended Citation

Chowdhury, Abdur and Wheeler, Mark, "The Impact of Output and Exchange Rate Volatility on Fixed Private Investment: Evidence from Selected G7 Countries" (2015). Economics Faculty Research and Publications. 542.
https://epublications.marquette.edu/econ_fac/542