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Exchange rate misalignment in developing countries
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The authors analyzes the theory of equilibrium real exchange rates and defines misalignment as a deviation of the real exchange rate (RER) from its equilibrium level, and the role of macroeconomic policies is analyzed under three alternative nominal exchange rate regimes.Abstract:
This article analyzes the theory of equilibrium real exchange rates and defines misalignment as a deviation of the real exchange rate (RER) from its equilibrium level. The role of macroeconomic policies is then analyzed under three alternative nominal exchange rate regimes: predetermined nominal exchange rates; floating nominal rates; and dual or black market nominal exchange rates. This discussion points out how inconsistent macroeconomic policies often lead to real exchange rate misalignment. Corrective measures, including nominal devaluation and several alternative approaches, are then evaluated.read more
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The real exchange rate and macroeconomic performance in Sub-Saharan Africa
Dhaneshwar Ghura,Thomas Grennes +1 more
TL;DR: In this paper, the negative relationship between the real exchange rate misalignment and economic performance (economic growth, imports, exports, saving and investment) was investigated in Sub-Saharan Africa.
Journal ArticleDOI
Real Exchange Rate Behavior and Economic Performance in LDCs
TL;DR: The relationship between RER behavior and performance indicators at a broad multicountry level or to investigate the sources of RER variability and misalignment in less developed countries (LDCs) is investigated in this paper.
Journal ArticleDOI
Real and monetary determinants of real exchange rate behavior: Theory and evidence from developing countries☆
TL;DR: In this article, a dynamic model of real exchange rate (RER) behavior in developing countries is developed, where a three goods economy (exportables, importables and non-tradables) is considered.
ReportDOI
Currency Crashes in Emerging Markets: Empirical Indicators
TL;DR: This article used a panel of annual data for over one hundred developing countries from 1971 through 1992 to characterize currency crashes, defined as a large change of the nominal exchange rate that is also a substantial increase in the rate of change of nominal depreciation.
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Emigrants' remittances and Dutch Disease in Cape Verde
Yves Bourdet,Hans Falck +1 more
TL;DR: In this article, the authors focused on their microeconomic effect on incomes and poverty in recipient countries, while earlier studies have focused on the microeconomic effects of emigrants' remittances.
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The exchange rate system
TL;DR: The authors examines the system of flexible exchange rates, estimating misalignments of major currencies and analyzing costs and benefits of volatility and deviations from equilibrium, and considers target zones, reference rates, and other alternatives for stabilizing the system.