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This paper investigates the impact of the distribution sector on the real exchange rate, controlling for the Balassa-Samuelson effect, as well as other macro variables. Long-run coefficients are estimated using a panel dynamic OLS estimator. The main result is that an increase in the...
Persistent link: https://www.econbiz.de/10005605202
This paper theoretically derives and empirically tests the implications of a new trade theory framework for the systematic movements in the real exchange rate. It focuses on the effect of imperfect substitutability of tradables and on the importance of competitiveness, for which we construct an...
Persistent link: https://www.econbiz.de/10005605250
This paper investigates the long-run impact of the distribution sector on the real exchange rate. The main result is that an increase in the productivity and product market competition of the distribution sector with respect to foreign countries leads to an appreciation of the real exchange...
Persistent link: https://www.econbiz.de/10005161792
In this note we show that the real exchange rate was indeed weakly exogenous in some of the specifications in MacDonald and Ricci (2004), but argue this was in all likelihood a function of the relatively limited degrees of freedom. We demonstrate here that by increasing the degrees of freedom,...
Persistent link: https://www.econbiz.de/10005203527
Persistent link: https://www.econbiz.de/10005203863
Persistent link: https://www.econbiz.de/10005171488
The External Balance Assessment (EBA) methodology has been developed by the IMF’s Research Department as a successor to the CGER methodology for assessing current accounts and exchange rates in a multilaterally consistent manner. Compared to other approaches, EBA emphasizes distinguishing...
Persistent link: https://www.econbiz.de/10011142197
Assessments of exchange rate misalignments and external imbalances for low-income countries are challenging because methodologies developed for advanced and emerging economies cannot be automatically applied to poorer nations. This paper uses a large database, unique in the set of indicators and...
Persistent link: https://www.econbiz.de/10010790491
We propose a theory of low-frequency movements in unemployment based on asymmetric real wage rigidities. The theory generates two main predictions: long-run unemployment increases with (i) a fall in long-run productivity growth and (ii) a rise in the variance of productivity growth. Evidence...
Persistent link: https://www.econbiz.de/10008727811
This paper investigates empirically the relevance of external, domestic, and financial weaknesses as well as trade and financial linkages in inducing financial crises for a sample of 61 emerging market and industrial countries. A panel probit estimation finds these economic indicators to be...
Persistent link: https://www.econbiz.de/10005769104