Resource title

Exchange rate uncertainty and labour market adjustment under fixed and flexible exchange rates

Resource image

image for OpenScout resource :: Exchange rate uncertainty and labour market adjustment under fixed and flexible exchange rates

Resource description

The standard literature on working time has modelled the decisions of firms in a deterministic framework in which firms can choose between employment and overtime (given mandated standard hours). Contrary to this approach, we follow the real options approach, which allows us to investigate the value to a firm of waiting to adjust labour when the firm´s revenues in domestic currency are stochastic and adjustment costs are sunk. The simulations reject the null hypothesis that all exchange rate regimes obey common employment adjustment thresholds.

Resource author

Yu-Fu Chen, Michael Funke

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/19357

Resource license

Adapt according to the presented license agreement and reference the original author.