Dynamics of Employment and Real Exchange Rates in Developing Countries PDF Download
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Author: Wanjoong Kim
Publisher:
ISBN:
Category :
Languages : en
Pages : 281
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Book Description
Author: Wanjoong Kim
Publisher:
ISBN:
Category :
Languages : en
Pages : 281
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Book Description
Author: Sebastian Edwards
Publisher: University of Chicago Press
ISBN: 0226184730
Category : Business & Economics
Languages : en
Pages : 460
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Book Description
In spite of the attention paid exchange rates in recent economic debates on developing countries, relatively few studies have systematically analyzed in detail the various ramifications of exchange rate policy in these countries. In this new volume from the National Bureau of Economic Research, leading economists use rigorous models to tackle various exchange rate issues, while also illuminating policy implications that emerge from their analyses. The volume, divided into four main sections, addresses: the role of exchange rates in stabilization programs and the adjustment process; the importance of exchange rate policy during liberalization reform in developing countries; exchange rate problems relevant and unique to developing countries, illustrated by case studies; and the problems defining, measuring, and identifying determinants of real exchange rates. Authors of individual papers examine the relation between commercial policies and exchange rates, the role of exchange rate policy in stabilization programs, the effectiveness of devaluations as a policy tool, and the interaction between exchange rate terms of trade an capital flow. This research will not only prove crucial to our understanding of the role of exchange rates in developing countries, but will clearly set the standard for future work in the field.
Author: Mr.Mohsin S. Khan
Publisher: International Monetary Fund
ISBN: 1451859597
Category : Business & Economics
Languages : en
Pages : 23
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Book Description
There is little empirical research on whether Balassa-Samuelson effects can explain the long-run behavior of real exchange rates in developing countries. This paper presents new evidence on this issue based on a panel data sample of 16 developing countries. The paper finds that the traded-nontraded productivity differential is a significant determinant of the relative price of nontraded goods, and the relative price in turn exerts a significant effect on the real exchange rate. The terms of trade also influence the real exchange rate. These results provide strong verification of Balassa-Samuelson effects for developing countries.
Author: Ejaz Ghani
Publisher:
ISBN:
Category : Balance of payments
Languages : en
Pages : 140
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Author: Mr.Jean Le Dem
Publisher: International Monetary Fund
ISBN: 1451850964
Category : Business & Economics
Languages : en
Pages : 43
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Book Description
This paper presents a quantitative macroeconomic model that accounts for key features of the labor market in developing countries. Primarily inspired by Côte d’Ivoire, the model contrasts a formal urban sector, where wages are rigidly fixed and employment is submitted to firms profit-seeking behavior, to urban and rural informal sectors, where wages are flexible and employment is affected by fluctuations in formal sector employment. Dynamic simulations assess the impact on key macroeconomic variables of a terms of trade improvement, a public wage decrease, and an exchange rate adjustment, highlighting the roles of rural-urban migrations and capital accumulation in the informal urban sector.
Author: Steve Brito
Publisher: International Monetary Fund
ISBN: 1484356349
Category : Business & Economics
Languages : en
Pages : 21
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Book Description
We show that the response of firm-level investment to real exchange rate movements varies depending on the production structure of the economy. Firms in advanced economies and in emerging Asia increase investment when the domestic currency weakens, in line with the traditional Mundell-Fleming model. However, in other emerging market and developing economies, as well as some advanced economies with a low degree of structural economic complexity, corporate investment increases when the domestic currency strengthens. This result is consistent with Diaz Alejandro (1963)—in economies where capital goods are mostly imported, a stronger real exchange rate reduces investment costs for domestic firms.
Author: Mariano Bosch
Publisher: World Bank Publications
ISBN:
Category : Business Cycle
Languages : en
Pages : 43
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Book Description
Abstract: The authors study the dynamics of three developing country labor markets using recent advances in the estimation of continuous time Markov processes. They first examine the flows of workers among five states: three types of paid labor, unemployment, and out of the labor force. The authors find a high degree of commonality in patterns of worker flows among the three countries and attempt to compare the flexibility of the markets by examining an index of overall mobility. Second, they seek to establish whether the issues of advanced country labor markets apply to developing country markets or whether the latter constitute a different phylum. Paralleling the mainstream literature on the role of being out of the labor force as discouraged unemployment, the authors then identify some common stylized facts about the role of the informal self-employed and salaried sectors and to what degree they serve as a holding pattern versus a desirable alternative to formal sector work. In the process, the authors identify very strong differences in mobility patterns between men and women and attempt to shed some light on whether these differences arise from discrimination or perhaps instead the constraints imposed by household responsibilities. Finally, they study labor market adjustment across the business cycle in Mexico and identify patterns of job creation and destruction among the three paid sectors and confirm the mainstream view of the role of out of the labor force as a procyclical phenomenon.
Author: Peter J. Montiel
Publisher:
ISBN:
Category : Developing countries
Languages : en
Pages : 54
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Author: Richie Dezi
Publisher:
ISBN: 9782534649931
Category : Business & Economics
Languages : en
Pages : 0
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Book Description
In the realm of developing countries like India today, Sabastian Edwards' testimonial from 1988, proclaiming that "real exchange rate behavior now occupies a central role in policy evaluation and design," remains highly pertinent. This enduring relevance stems from the substantial impact that exchange rates exert on the external competitiveness of economies. Exchange rate fluctuations wield considerable influence over the decisions made by global traders, foreign investors, international travelers, and policymakers. Their ramifications ripple through external financial obligations, trade balances, internal resource allocation, and economic productivity. The exchange rate stands out as one of the foremost indicators of economic value within a nation, as highlighted by Frait and Komárek in 2001. Its preeminent role is in gauging a country's economic growth. The exchange rate's influence extends across a multitude of economic dimensions, including international trade, the assessment of uncertainties surrounding export and import prices, the valuation of international reserves and open positions in foreign and domestic currencies, as well as the domestic currency's worth in terms of debt payments and workers' remittances. These factors, in turn, can cascade through domestic wages, prices, output, and employment. The exchange rate serves as a pivotal link between a country and the global stage, impacting both goods and asset markets. It shapes the volumes of exports and imports by altering their relative prices and influences the magnitude of foreign debt when measured in domestic currency terms. In contemporary times, the exchange rate has assumed a strategic role, as observed by Rabia Najaf in 2017. The real exchange rate directly influences trade, particularly international trade, and indirectly affects production and employment. Thus, comprehending the factors driving its fluctuations becomes imperative. Moreover, in international financial markets, expectations regarding future exchange rates exert profound effects on various aspects of agents' decisions, including their choices related to investment, hedging, borrowing, and lending, as highlighted by William in 2007. Since the dissolution of the Bretton Woods System, the dynamics of exchange rates have evolved significantly.
Author:
Publisher: World Bank Publications
ISBN:
Category :
Languages : en
Pages : 49
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Book Description
LDC adjustment packages Riccardo Faini and Jaime de Melo Developing countries have been hit by a fall in their terms of trade, high real interest rates on their external debt, and a drought in commercial lending from abroad. Their subsequent adjustment packages, often supported by loans from the IMF and World Bank, focused on a sharp real exchange rate depreciation to restore external balance and a host of microeconomic reforms to secure a simultaneous supply-side improvement. This paper examines the success of these ‘adjustment with growth' packages in a large sample of developing countries. We find these packages have been much more successful in LDCs which export manufactures than they have in those concentrating on primary exports (primarily low-income African countries); the latter have not resumed sustainable growth, and most of their external adjustment has arisen from expenditure reduction, not an increase in supply. The longer-term prospects for manufacturing exporters are also brighter: there we detect signs of increased efficiency and a smaller decline in investment than in primary exporters. But we also find that a high external debt burden and an unstable macroeconomic environment impede investment in all LDCs. In the longer term, adjustment with growth packages will succeed only if they are accompanied by a more stable macroeconomic environment and appropriate debt relief
