Exchange-Rate Dark Matter

@inproceedings{Evans2012ExchangeRateDM,
  title={Exchange-Rate Dark Matter},
  author={Martin D. D. Evans},
  year={2012}
}
Dark matter is believed to account for 83 percent of the matter in the universe and plays a central role in cosmology modeling. This paper argues that an analogous form of dark matter plays a similarly important role in international macroeconomics. Like its cosmological counterpart, exchange-rate dark matter cannot be directly observed, but its existence can be inferred from observations on the real exchange rates and interest rates. In the first part of this paper I show that dark matter is… CONTINUE READING