{
  "title": "Exchange Rates and Economic Fundamentals: A Methodological Comparison of BEERs and FEERs",
  "publication": "IMF Working Papers, May 1, 1998",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/exchange-rates-and-economic-fundamentals-a-methodological-comparison-of-beers-and-feers-2592",
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  "summary": "This paper compares two approaches for examining the extent to which a country’s actual real effective exchange rate is consistent with economic fundamentals: the FEER approach, which involves calculating the real exchange rate that equates the current account at full employment with sustainable net",
  "sections": [
    {
      "heading": "Summary of purpose and approaches",
      "content": "- Compares two approaches for assessing whether a country’s actual real effective exchange rate is consistent with economic fundamentals:\n  - FEER approach: calculates the real exchange rate that equates the current account at full employment with sustainable net capital flows.\n  - BEER approach: uses econometric methods to establish a behavioral link between the real rate and relevant economic variables.\n- An exchange rate model is estimated for the G-3 currencies to provide illustrative comparisons of BEERs and FEERs."
    },
    {
      "heading": "Key findings and analytical focus",
      "content": "- The paper presents a methodological comparison between FEERs and BEERs as tools for evaluating equilibrium real exchange rates.\n- The G-3 exchange rate model is used to illustrate differences and similarities between BEER estimates and FEER calculations."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects:\n  - Balance of payments\n  - Capital account\n  - Current account\n  - Exchange rates\n  - Foreign exchange\n  - Real effective exchange rates\n  - Real exchange rates\n- Keywords:\n  - BEER analysis\n  - BEER estimate\n  - Capital account\n  - Current account\n  - equilibrium exchange rate\n  - Exchange rates\n  - FEER approach\n  - FEER calculation\n  - FEER exchange rate measure\n  - Real effective exchange rates\n  - Real exchange rates\n  - U.S. dollar\n  - WP\n\n---\n\n Content in this bundle\n\n- Exchange Rates and Economic Funamentals: A Methodological Comparison of BEERs and Feers - WP/98/67\n  - Exchange Rates and Economic Funamentals: A Methodological Comparison of BEERs and Feers - WP/98/67 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Exchange Rates and Economic Funamentals: A Methodological Comparison of BEERs and Feers - WP/98/67 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/exchange-rates-and-economic-fundamentals-a-methodological-comparison-of-beers-and-feers-2592"
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    "[Markdown version](/en/publications/wp/issues/2016/12/30/exchange-rates-and-economic-fundamentals-a-methodological-comparison-of-beers-and-feers-2592/index.md)",
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    "Authors: Ronald MacDonald, Peter B. Clark",
    "Published: May 1, 1998",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451961683.001",
    "Compares two approaches for assessing whether a country’s actual real effective exchange rate is consistent with economic fundamentals:",
    "An exchange rate model is estimated for the G-3 currencies to provide illustrative comparisons of BEERs and FEERs.",
    "The paper presents a methodological comparison between FEERs and BEERs as tools for evaluating equilibrium real exchange rates.",
    "The G-3 exchange rate model is used to illustrate differences and similarities between BEER estimates and FEER calculations.",
    "Subjects:",
    "Keywords:",
    "**Exchange Rates and Economic Funamentals: A Methodological Comparison of BEERs and Feers - WP/98/67**"
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