UNIVERSITY of GLASGOW

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Professor Ronald MacDonald, BA (hons), MA (econ.), PhD

Adam Smith Chair of Political Economy (part-time)

R.Macdonald@lbss.gla.ac.uk
Tel: +44(0)141 330 1988
Room S102

Research interests

International Economics, Macroeconomics, Exchange Rates

Background

Ronnie joined the Department in January 2005.  He was previously Professor of International Finance at the University of Strathclyde since 1992.  He holds degrees from Heriot-Watt University and the University of Manchester. He has a wide range of interests in the general areas of macroeconomics and international finance, has published over 130 articles in peer-reviewed journals and has authored or edited 12 books. His work on exchange rate modelling has been influential in the academic literature and also for practitioners and policy makers. For example, his behavioural equilibrium exchange rate (BEER) approach, developed jointly with Peter Clark at the IMF, has been widely used by central banks and the wider financial community to assess the degree of misalignment of major currencies. A recent application of the BEER approach can be found at http://ideas.repec.org/p/gla/glaewp/2007_12.html. Other policy related work has involved proposals to scrap the so-called Barnett Formula and replace it with a more fiscally devolved system for the Scottish parliament (see, for example, http://ideas.repec.org/p/gla/glaewp/2006_14.html). His recent book on exchange rates - Exchange Rate Economics: Theories and Evidence (Taylor and Francis) - is the second edition of Floating Exchange Rates: Theories and Evidence, first published in 1988.

Ronald MacDonald is also a Fellow of the Royal Society of Edinburgh; Research Fellow of the CESifo Research Network Munich; and an International Fellow of the Kiel Institute of Economics. He is an associate editor for six economics journals, has been a consultant and visiting scholar at the IMF on 14 separate occasions and has presented his five-day course on the economics of exchange rates on seven separate occasions at the IMF Institute. In addition, he has acted as a consultant to many organisations including the European Commission, a wide range of central banks and a number of private sector financial institutions. Ronald has consistently been ranked in the top two per cent of economists in the world in the IDEAS/RePEc ranking.

Recent selected publications

Byrne, J.P., Darby, J. and MacDonald, R., (2008). 'US trade and exchange rate volatility: A real sectoral bilateral analysis', Journal of Macroeconomics, vol. 30, pp. 238-259.

MacDonald, R. and Ricci, L.A. (2007). 'Real exchange rates, imperfect substitutability, and imperfect competition', Journal of Macroeconomics, vol. 29(4), pp. 639-664.

MacDonald, R., Menkhoff, L. and Frömmel, M. (2005). 'Markov switching regimes in a monetary exchange rate model', Economic Modelling, vol. 22(3), (May), pp. 485-502.

MacDonald, R., Menkhoff, L. and Frömmel, M. (2005). 'Do fundamentals matter for the D-Mark/Euro Dollar? A regime switching approach', Global Finance Journal, vol. 15(3), (February), pp. 321-335.

MacDonald, R. and Bordo, M.D. (2005). 'Interest rate interactions in the classical gold standard, 1880-1914: was there any monetary independence?', Journal of Monetary Economics, vol. 52(2), (March), pp. 307-327.  Also appeared as 'Violations of the "Rules of the Game" and the credibility of the classical gold standard, 1880-1914', NBER working paper No. 6115.

MacDonald, R., Crespo-Cuaresma, J. and Fidrmuc, J. (2005). 'The monetary approach to exchange rates in the CEECs', The Economics of Transition, vol. 13(2), (April), pp. 395-416.

MacDonald, R. and Ricci, L. (2005). 'PPP and the Balassa Samuelson effect: the role of the distribution sector', Pacific Economic Review, vol. 10(1), (February), pp. 29-48.  This also appeared in 2002 as IMF Working Paper 02/32, 'Purchasing power parity and the new trade theory'.

MacDonald, R. and Juselius, K. (2004). 'International parity relationships between the USA and Japan', Japan and the World Economy, vol. 16(1), (January), pp. 17-34.

MacDonald, R. and Marsh, I.W. (2004). 'Currency spillovers and tripolarity: a simultaneous model of the US Dollar, German Mark and Japanese Yen', Journal of International Money and Finance, vol. 23(1), (February), pp. 99-111.

MacDonald, R. and Clark, P. (2004). 'Filtering the BEER: a permanent and transitory decomposition', Global Finance Journal, vol. 15(1), pp. 29-56.

MacDonald, R. and Wojick, C. (2004). 'Catching up: the role of demand supply and regulated price effects on the real exchange rates of four accession countries', The Economics of Transition, vol. 12(1), (March), pp. 153-179.

MacDonald, R., and Ricci, L. (2004). 'Estimation of the equilibrium real exchange rate for South Africa', IMF Working Paper No WP/03/44 and South African Journal of Economics, vol. 72(2), (June), pp. 282-304.

MacDonald, R. and Bordo, M.D. (2003). 'The inter-war gold exchange standard: credibility and monetary independence', Journal of International Money and Finance, vol. 22(1), (February), pp. 1-32.

MacDonald, R. Benassy-Quéré, A. and Larribeau, S. (2003). 'Models of exchange rate expectations: how much heterogeneity?', Journal of International Financial Markets, Institutions and Money, vol. 13(2), (April), pp. 113-136.

MacDonald, R. and Edison, H. (2003). 'Credibility and interest rate discretion in the ERM', Open Economies Review, vol. 14(4), (October), pp. 351-368

MacDonald, R. and Chionis, D. (2002). 'Aggregate and disaggregate measures of the foreign exchange risk premium', International Review of Economics and Finance, vol. 11(1), (April), pp. 57-84.

MacDonald, R. and Fiess, N. (2002). 'Towards the fundamentals of technical analysis: analysing the information content of high, low and close prices', Economic Modelling, vol. 19(3), (May), pp. 353-374.

MacDonald, R. and Hallwood, P. (2002). 'A method for indicating economic transition with and application to Albania', Eastern Economic Journal, vol. 28(4), (autumn), pp. 465-480.

MacDonald, R. (2002). 'Modelling the long-run real effective exchange rate of the New Zealand Dollar', Australian Economic Papers, vol. 41(4), (December), pp. 519-537.

MacDonald, R. and Moore, M. (2001). 'The spot-forward relationship revisited: an ERM perspective', Journal of International Financial Markets, Institutions and Money, vol. 11(1), (March), pp. 29-52.

MacDonald, R., Cushman, D. and Samborsky, M. (2001). 'The law of one price in transitional Ukraine', Economics Letters, vol. 73(2), (November), pp. 251-256.

MacDonald, R. and Feiss, N. (2001). 'The instability of the money demand function: an I(2) interpretation', Oxford Bulletin of Economics and Statistics, vol. 63(4), (September), pp. 475-495.

MacDonald, R. (2000). 'Is the foreign exchange market risky? Some new survey-based results', Journal of Multinational Financial Management, vol. 10(1), (January), pp. 1-14.

MacDonald, R. and Nagayasu, J. (2000). 'The long-run relationship between real exchange rates and real interest rate differentials: a panel study', IMF Staff Papers, vol. 47(1), (November), pp. 116-128.

MacDonald, R. and La Cour, L. (2000). 'Modelling the ECU against the US Dollar: a structural monetary interpretation', Journal of Business and Economic Statistics, vol. 18(4), (October), pp. 436-450.

MacDonald, R., Hallwood, P. and Marsh, I. (2000). 'An assessment of the causes of the abandonment of the gold standard by the U.S. in 1933', Southern Economic Journal, vol. 67(2), (October), pp. 448-459.

MacDonald, R., Hallwood, C.P. and Marsh, I.W. (2000). 'Realignment expectations and the U.S. Dollar 1890-1897: was there a "Peso" problem?', Journal of Monetary Economics, vol. 46(3), (December), pp. 605-620.