I have problem with an article Lee H., C. Park, 2013, International Transmission of Food Prices and Volatilities: A Panel Analysis.
Authors wrote: Difference in log of exchange rates (LOC/ $)- As depreciation of local currency (LOC) against the US dollar will result in higher domestic prices of imported food products in local currency, this variable is expected to carry a positive sign.
Variable (LOC/$) has positive sign in there econometric model. How it is possible?
When exchange rate (LOC/$) rises we have aprreciation of local currency so food prices are lower. I think that the sign should be negative
Can someone help me?