Real Exchange Rate Volatility and Economic Openness: Theory and Evidence

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Exchange Rate Disconnect in General Equilibrium (2017, unknown): “This is in line with the data, where the more open economies have indeed less volatile exchange rates, even after controlling for country size and other characteristics (see, e.g., Hau 2002).”
Real Exchange Rate and International Reserves in an Era of Growing Financial and Trade Integration (2007, unknown): “● The results support the hypothesis that international trade helps mitigate pressures for real appreciation (see Hau, 2002).”
International Prices and Exchange Rates (2013, unknown): “Hau (2002) shows that more open economies tend to display less volatile RERs.”
US trade and exchange rate volatility: a real sectoral bilateral analysis (2008, methodology): “By using better measures of the price deflators, new sectoral 3 The authors invoke the empirical results from Hau (2002) who suggests that more open economies have faster pass through from exchange rate changes to the domestic aggregate price level.”
Exchange Rate Volatility and Productivity Growth: The Role of Financial Development (2009, unknown): “For instance, Hau (2002) nds a negative correlation between real exchange rate volatility and trade openness.31 However, this does not a¤ect our estimation as our speci cation includes both real exchange rate volatility and trade openness as regressors and treat them as jointly endogenous.”