RDP 2010-07: Monetary Policy and the Exchange Rate: Evaluation of VAR Models
Equation (13)
x
t
≡
y
t
−
y
¯
t
=
y
t
−
ϕ
t
y
t
*
−
ϕ
2
σ
(
ν
x
,
t
−
ν
x
,
t
*
)
−
ϕ
4
a
t
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