Fachartikel
Agents’ Rationality and the CHF/USD Exchange Rate

Agents’ Rationality and the CHF/USD Exchange Rate

Part IV

A new model containing the CHF/USD exchange rate, s t, is introduced, estimated, and discussed. The model represents a revised version of model (II) as discussed in Part III of our series of papers. Model (II) was found there to be defective neglecting e.g. the proper influence of monetary policy on regime switches. The properties of cognitive processes and social practices (at foreign exchange markets) are a central feature of our approach. We use them again when introducing e.g. bond markets and an inflationary process into (II).