Apertura, productividad y gasto agregado: un modelo de fundamentos del tipo de cambio real
AbstractThe Uruguayan economy has undergone over the past two decades an important growth process, together with a real appreciation of the domestic currency. This implied that the Real Exchange Rate (RER), calculated as TP/NTP, experienced important changes. From this phenomenon, this paper examines the evolution of the price competitiveness of the economy in light of the possible presence of "Balassa-Smuelson Effect" and a change in the economy's pattern of international integration, in a context of income growth and aggregate expenditure, through the methodology proposed by Johansen. Thus, we found a long-term relationship between the RER, the differential in labor productivity between the Uruguayan and U.S. economies, goods extra-regional exports and the economy's consumption. Furthermore, we found that the elasticities of RER to its long-term fundamentals lie in line with the theory and concludes that the equilibrium real exchange rate has fallen in the last two decades due to the movement of its fundamentals.
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Bibliographic InfoPaper provided by Instituto de Economia - IECON in its series Documentos de Trabajo (working papers) with number 12-19.
Length: 34 pages
Date of creation: Sep 2012
Date of revision:
Real exchange rate; Cointegration; Fundamentals;
Find related papers by JEL classification:
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
- F31 - International Economics - - International Finance - - - Foreign Exchange
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-12-22 (All new papers)
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