Deviation From The Beer Model-based Real Exchange Rate Of Rmb Equilibrium Exchange Rate

Based on relevant research of the Equilibrium Exchange Rate theory, the author chooses the theory of Behavioral Equilibrium Exchange Rate raised by Clark and MacDonald for further research, and make empirical analysis through statistical analysis of economic indicators and time series analysis. The period of the data collected and analyzed is from 1994 to 2007. By establishing the BEER model of RMB, the Behavioral Equilibrium Exchange Rate of RMB can be measured and calculated by the methods of ADF unit root test, Johansen co-integration test, Impulse response analysis and H-P filter. Furthermore, the deviation between RMB real exchange rate and its equilibrium exchange rate can be estimated.On the basis of RMB behavioral equilibrium exchange rate analysis, this paper has further discussed the effects which real exchange rate misalignment and rapid currency appreciation exert on the economy and also has established the co-integration equations which reflect the relationship between the real exchange rate misalignment and the import or export from 1994 to 2007. By analyzing the effects caused by the rapid appreciation of Japanese Yen exerted on the Japanese economy from 1970s to 1990s, we may obtain some useful references for RMB appreciation. Finally, combining the analysis and research above, we come to the conclusion that RMB real exchange rate should enjoy stable appreciation in the medium and long-term, and make some suggestions for the perfection of relevant policies under the expectation of RMB steady appreciation.