Milkshake Prices, International Reserves, and the Mexican Peso
Menu prices from 13 international restaurant franchises that operate in both El Paso and Ciudad Juárez are utilized to examine the behavior over time of the peso/dollar exchange rate. Parametric and nonparametric tests indicate that the price ratio alone provides a biased estimator for the exchan...
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| Autores principales: | , |
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| Formato: | article |
| Lenguaje: | EN ES |
| Publicado: |
El Colegio de la Frontera Norte
2005
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| Materias: | |
| Acceso en línea: | https://doaj.org/article/cfb257fddbdf488d9d137e4b1db0ccd9 |
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| Sumario: | Menu prices from 13 international restaurant franchises that operate in both El Paso and
Ciudad Juárez are utilized to examine the behavior over time of the peso/dollar exchange
rate. Parametric and nonparametric tests indicate that the price ratio alone provides a biased
estimator for the exchange rate. In addition to the multiproduct price ratio, the empirical
analysis also incorporates interest rate parity and balance of payments variables. The
combination of unique microeconomic sample data with national macroeconomic variables
illustrates one manner in which border economies provide information regarding
the interplay of financial markets between Mexico and the United States. |
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