Implicit bands in the Spanish peseta/Deutschmark exchange rate, 1965-1998
- Francisco J. Ledesma Rodríguez
- Manuel Navarro Ibáñez
- Jorge Vicente Pérez Rodríguez
- Simón Sosvilla Rivero
ISSN: 0960-3107
Any de publicació: 2007
Volum: 17
Número: 10-12
Pàgines: 921-932
Tipus: Article
Altres publicacions en: Applied financial economics
Resum
The objective of this article is to identify implicit bands for the Spanish peseta/Deutschmark exchange rate. To this end, based on the 'natural' classification approach suggested by Reinhart and Rogoff (2004), we propose a statistical test to assess the statistical significance of the outcome of their classifying algorithm. The test is applied to the period 1965-1998, indicating our results existence of fluctuation bands in the 1980s and 1990s, before and after the entry of the peseta into the European Monetary System.