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In Search of Equilibrium: Estimating Equilibrium Real Exchange Rates in Sub-Saharan African Countries

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Author Info
Alexander Chudik
Joannes Mongardini
Abstract

This paper presents a methodology to estimate equilibrium real exchange rates (ERER) for Sub-Saharan African (SSA) countries using both single-country and panel estimation techniques. The limited data set hinders single-country estimation for most countries in the sample, but panel estimates are statistically and economically significant, and generally robust to different estimation techniques. The results replicate well the historical experience for a number of countries in the sample. Panel techniques can also be used to derive out of sample estimates for countries with a more limited data set.

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Paper provided by International Monetary Fund in its series IMF Working Papers with number 07/90.

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Length: 39 pages
Date of creation: 17 Apr 2007
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Handle: RePEc:imf:imfwpa:07/90

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Keywords: Exchange rates ; Sub-Saharan Africa ; Economic models ;

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  5. Charalambos G. Tsangarides & Yasser Abdih, 2006. "FEER for the CFA Franc," IMF Working Papers 06/236, International Monetary Fund. [Downloadable!]
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  13. Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-52, Special I. [Downloadable!] (restricted)
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  20. M Pesaran & Yongcheol Shin & Ron P Smith, 2004. "Pooled mean group estimation of dynamic heterogeneous panels," ESE Discussion Papers 16, Edinburgh School of Economics, University of Edinburgh. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Patrick A. Imam & Camelia Minoiu, 2008. "Mauritius: A Competitiveness Assessment," IMF Working Papers 08/212, International Monetary Fund. [Downloadable!]
  2. Brett Rayner & Joannes Mongardini, 2009. "Grants, Remittances, and the Equilibrium Real Exchange Rate in Sub-Saharan African Countries," IMF Working Papers 09/75, International Monetary Fund. [Downloadable!]
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