Great expectations? evidence from Colombia’s exchange rate survey
In this paper written by Juan Jose Echavarria and Mauricio Villamizar-Villegas, we use the largest exchange rate survey in Colombia to test for the rational expectations hypothesis, the presence of a time-varying risk premium and the accuracy of exchange rate forecasts. Our findings indicate that episodes of exchange rate appreciation preceded expectations of further appreciation
- Published in Revistas CIDE
Market discipline: a review of the Mexican deposit market
This paper written by Edgar Demetrio Tovar-García, studies the mechanisms of market discipline in the Mexican deposit market. It tests the hypothesis that low-quality banks pay higher interest rates on deposits, receive fewer deposits, and shift their deposit agreements from long to short term. This hypothesis was assessed with positive evidence in Mexico during the period
- Published in Revistas CIDE