This study tests for non-linearities in the behavior of US dollar real exchange rates of thirteen Latin American countries. For this purpose, logistic and exponential smooth transition regression models are applied to quarterly data over the sample period 1973Q2-2001Q1. There is evidence of non-linearities in the behavior of seven real exchange rates where, in most of these cases, non-linearities are captured by the logistic smooth transition autoregressive model. The extent of non-linearities varies across Latin American countries with Colombia and Venezuela exhibiting the sharpest transition between regimes of low and high real exchange rates.
Holmes, M. (2016). Are there non linearities in US: Latin American real exchange behavior. Estudios De Economía, 29(2), pp. 177–190. Retrieved from https://sintesisdejurisprudencia.uchile.cl/index.php/EDE/article/view/40832
