Presidential cycles in the USA and the dollar-pound exchange rate : evidence from over two centuries
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Date
Authors
Gupta, Rangan
Wohar, Mark E.
Journal Title
Journal ISSN
Volume Title
Publisher
Asia University, Taiwan
Abstract
In this paper, we analyze the impact of the U.S. presidential cycles on the dollar relative to the
British pound over the longest possible monthly period of 1791:01 to 2018:10, based on GJR
(or threshold generalized autoregressive conditional heteroscedasticity (GARCH)) model. The
usage of over two centuries of data controls for sample selection bias, while a GJR model
accommodates for omitted variable bias. We find that over the entire sample period, the
Democratic regime has indeed depreciated the dollar relative to the pound. However, during
the post Bretton Woods era, the depreciation of the dollar is not statistically significant under
the Democratic presidents.
Description
Keywords
Exchange rate, United States (US), U.S. presidential cycles
Sustainable Development Goals
Citation
Gupta, R. & Wohar, M.E. 2019, 'Presidential cycles in the USA and the dollar-pound exchange rate : evidence from over two centuries', Advances in Decision Sciences, vol. 23, no. 2, pp. 1-13.