Media bias and central bank response. Evidence from the nominal exchange rate behavior in Colombia
| Data(s) |
01/11/2011
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|---|---|
| Resumo |
Since 1991 Colombia has had a market-determined Peso - US Dollar Nominal Exchange Rate (NER), after more than 20 years of controlled and multiple exchange rates. The behavior (revaluation / devaluation) of the NER is constantly reported in news, editorials and op-eds of major newspapers of the nation with particular attention to revaluation. The uneven reporting of revaluation episodes can be explained by the existence of an interest group particulary affected by revaluation, looking to increase awareness and sympathy for help from public institutions. Using the number of news and op-eds from a major Colombian newspaper, it is shown that there is an over-reporting of revaluation episodes in contrast to devaluation ones. Secondly, using text analysis upon the content of the news, it is also shown that the words devaluation and revaluation are far apart in the distribution of words within the news; and revaluation is highly correlated with words related to: public institutions, exporters and the need of assistance. Finally it is also shown that the probability of the central bank buying US dollars to lessen revaluation effects increases with the number of news; even though the central bank allegedly intervenes in the exchange rate market only to tame volatility or accumulate international reserves. |
| Formato |
application/pdf |
| Identificador | |
| Publicador |
Facultad de Economía |
| Relação |
Serie Documentos de trabajo ; No. 115 https://ideas.repec.org/p/col/000092/009153.html |
| Direitos |
info:eu-repo/semantics/openAccess |
| Fonte |
instname:Universidad del Rosario reponame:Repositorio Institucional EdocUR instname:Universidad del Rosario Banco de la Republica (2010). Series estad ´ ´ısticas de colombia. Web site, http://www.banrep.gov.co. Caballero, C. (2008). De la miop´ıa a la ceguera absoluta. El Tiempo archive, http://www.eltiempo.com/archivo/documento/MAM-2846761 (Date: 01-03-2008). Cameron, C. and P. Trivedi (2005). Microeconometrics: methods and applications. Oxford University Press, Cambridge, UK. Cameron, C. and P. Trivedi (2009). Microeconometrics Using Stata. StataCorp LP. Congreso de Colombia (1967). Decreto-Ley 444 de 1967. Congreso de la Rep ´ublica de Colombia. Gaceta del Congreso Corneo, G. (2006). Media capture in a democracy: The role of wealth concentration. Journal of Public Economics 90(1-2), 37–58. El Tiempo (1997). Un mercado de opciones. El Tiempo archive, http://www.eltiempo.com/archivo/documento/MAM-684297 (Date: 28-07-1997). Fagan, S. and R. Gencay (2011). Handbook of empirical economics and finance, Chapter An introduction to textual econometrics, pp. 133–154. CRC Press. Gentzkow, M. and J. M. Shapiro (2008). Competition and truth in the market for news. Journal of Economic Perspectives 22(2), 133–154. kamil, H. (2008). Is central bank intervention effective under inflation targeting regimes? the case of colombia. IMF Working Papers 08/88, International Monetary Fund. R Development Core Team (2011). R: A Language and Environment for Statistical Computing. Vienna, Austria: R Foundation for Statistical Computing. Wooldridge, J. (2001). Econometric analysis of cross section and panel data. MIT Press, Cambridge, Mass. |
| Palavras-Chave | #Tipos de cambio #Cambio exterior #Competencia imperfecta #Banco Central -- Colombia #332.11 #News bias #Central banking -- Colombia #Nominal Exchange Rate (NER) #Negative Binomial Regression Model (NBRM) #Probit model |
| Tipo |
info:eu-repo/semantics/book info:eu-repo/semantics/acceptedVersion |
