Construct · 1 fields · 1 citations

peso problem: a standalone construct

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International finance

the bias in tests of market efficiency that arises when prices reflect a small probability of a large event that does not occur in the sample.

In international finance, peso problem refers to the bias in tests of market efficiency that arises when prices reflect a small probability of a large event that does not occur in the sample. This meaning comes from Krasker (1980) in Journal of Monetary Economics.[1]

Unit
Recovery means
Measured by

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Nearby constructs

bias6 fields · 8 citationsjingle · one name, six constructs efficiency4 fields · 5 citationsjingle · one word, four constructs efficient market hypothesis3 fields · 8 citationsjingle · one word, three constructs

References

Krasker, W. S. (1980). The ‘peso problem’ in testing the efficiency of forward exchange markets. Journal of Monetary Economics, 6(2), 269-276. https://doi.org/10.1016/0304-3932(80)90031-8

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