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Increased attention is being paid to assessments of the actual values of countries' real exchange rates relative to their "equilibrium" values as suggested by "fundamental" determining factors. This paper assesses the robustness of alternative approaches and models commonly used to derive equilibrium real exchange rate estimates. Using China's currency to illustrate this analysis, the variance in estimates raises serious questions regarding how robust the results are. The basic conclusion from the tests used here is that, at least for China, small changes in model specifications, explanatory variable definitions, and time periods used in estimation can lead to very substantial differences in equilibrium real exchange rate estimates. Thus, such estimates should be treated with great caution.

Electronic books. -- local. --- Foreign exchange -- China. --- Foreign exchange rates -- China -- Mathematical models. --- Foreign exchange rates --- Foreign exchange --- Mathematical models. --- Cambistry --- Currency exchange --- Exchange, Foreign --- Foreign currency --- Foreign exchange problem --- Foreign money --- Forex --- FX (Finance) --- International exchange --- Exchange rates --- Fixed exchange rates --- Flexible exchange rates --- Floating exchange rates --- Fluctuating exchange rates --- Rates of exchange --- Rates --- International finance --- Currency crises --- Exports and Imports --- Foreign Exchange --- Current Account Adjustment --- Short-term Capital Movements --- Currency --- International economics --- Real exchange rates --- Real effective exchange rates --- Current account balance --- Purchasing power parity --- Balance of payments --- China, People's Republic of