RESEARCH ON THE JAPANESE YEN Paper Example | Topics and Well Written Essays - 2000 words

ON THE Nipponese YEN - Research Paper ExamplePrecisely, this theory argues that a unit current, for instance, the Yen must pick up the same buying power in a foreign country. The study uses the Japanese Yen unitedly with other currencies in testing the PPP hypothesis and focuses on the verifiable analysis from 1980 up to ring 2013. This period is divided into three windows. The first window is what is referred to as the complete sample the pre-crisis sample, which began in January 1980 and terminate in August 2008, is the second window. The third window is referred to as the crisis sample, starting from September 2008 up to environ 2013. The Japanese Yen among other currencies such as the Euro, the British pound and the U.S dollar are lynchpin currencies of the recent floating exchange rate period. In this regard, the first step of the study was to check for the perceptual constancy of the real exchange rate prior to and after Lehman Brothers crash in 2008. The empirical res ults showed that the real exchange rate is not constant for Japanese yen.For a proper evaluation of the hassle under study this paper will comprise of various sections, including a brief literature review, the econometric methodology, data and empirical evidence, and lastly a summary of the findings and concluding remarks.The purchasing power theory dates backbone to several centuries ago, beginning with the Spanish doctors and the Salamanca School of the 16th century who had crucial contributions to the economic theory (Laurentiu). They intentional a quantitative money theory of the foreign exchange, which was based on diversity in purchasing power in various countries from observing the general effects on price levels, exchange rank and money supplies of large inflows of gold from the newly discovered continent, America.The celebrated Augustinian doctor, called Doctor Navarrus came up with some enceinte contributions in