Exchange Rate Determinants of the US Dollar and Chinese RMB: a Classical Political Economics Approach

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Published: Dec 17, 2022
DOI: https://doi.org/10.22201/fe.01851667p.2023.323.83171

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Thanos Poulakis
Department of Economics, Aristotle University of Thessaloniki
Persefoni Tsaliki
Department of Economics, Aristotle University of Thessaloniki

Abstract

This paper contributes to the literature on determining the real exchange rates by developing a model that is based on key propositions of the classical political economy within which the real competition governs domestic and international trade, the labor theory of value is underneath domestic and international prices and, under these conditions, the principle of absolute cost advantage shapes international trade. The econometric analysis shows that the relative real unit labor cost is a key regulator of the long-run behavior of real exchange rates in both, China and the USA, for the period 1982-2018.

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How to Cite
Poulakis, T., & Tsaliki, P. (2022). Exchange Rate Determinants of the US Dollar and Chinese RMB: a Classical Political Economics Approach. Investigación Económica, 82(323), 3–26. https://doi.org/10.22201/fe.01851667p.2023.323.83171

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Author Biographies

Thanos Poulakis, Department of Economics, Aristotle University of Thessaloniki

Thanos Poulakis received his BA and MA from Aristotle University of Thessaloniki. He is currently a PhD Candidate at the Department of Economics of the Aristotle University of Thessaloniki in the field of Political Economy. His research interests are in the fields of Political Economy, Exchange Rates, International Trade and Productivity.

Persefoni Tsaliki, Department of Economics, Aristotle University of Thessaloniki

Dr. Persefoni Tsaliki received her BA from Aristotle University of Thessaloniki and her MA and PhD from New School for Social Research, New York. She is currently a Professor at the Department of Economics of the Aristotle University of Thessaloniki teaching Political Economy, History of Economic Thought and undergraduate and graduate level.

Her research interests are in the fields of Political Economy, Profitability, Accumulation, Productivity and Growth. She has published several books and many articles in journals such as Review of Industrial Organization, Review of Radical Political Economics, International Review of Applied Economics, Cambridge Journal of Economics, etc.

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