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What Do We Know of Trade Elasticities?

Author

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  • Hafsa Hina

    (Pakistan Institute of Development Economics)

Abstract

Devaluation[2] is necessitated only when policy weakness leads to a loss of reserves. It takes on a harsher form when central banks refuse to recognize the will of the market and spends reserves to preserve an artificial value of the exchange rate. Ill-informed popular debate appears to hold to the notion that the purpose of a devaluation is to devalue to improve the trade balance and as they say �improve competitiveness.�

Suggested Citation

  • Hafsa Hina, 2021. "What Do We Know of Trade Elasticities?," PIDE Knowledge Brief 2021:30, Pakistan Institute of Development Economics.
    • Handle: RePEc:pid:kbrief:2021:30
    as

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    References listed on IDEAS

    as
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    Keywords

    Real Exchange Rate; Trade Balance; Elasticities;
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