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Impact du fardeau virtuel de la dette sur le taux de change réel d'équilibre des pays en développement

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Author Info
Babacar XSENE (PARIS DAUPHINE UNIVERSITY)

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Abstract

The main objective of this paper is to study the relationship between external public debt and equilibrium real exchange rate in developing countries. Using a extension of Obstfeld & Rogoff (1995) model we show that debt overhang tend to appreciate real exchange rate in the long run (Krugman (1979), Sargent & Wallace (1989)). The relationship between debt overhang and real exchange rate is obtaining with endogeneity of economic growth.

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File URL: http://129.3.20.41/eps/mac/papers/0501/0501014.pdf
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Publisher Info
Paper provided by EconWPA in its series Macroeconomics with number 0501014.

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Length: 27 pages
Date of creation: 09 Jan 2005
Date of revision:
Handle: RePEc:wpa:wuwpma:0501014

Note: Type of Document - pdf; pages: 27
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Web page: http://129.3.20.41

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Related research
Keywords: Public debt; debt overhang; real exchange rate; new open macro economics ; growth;

Find related papers by JEL classification:
F31 - International Economics - - International Finance - - - Foreign Exchange
F34 - International Economics - - International Finance - - - International Lending and Debt Problems
F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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  1. Agenor, Pierre-Richard, 1998. "Capital inflows, external shocks, and the real exchange rate," Journal of International Money and Finance, Elsevier, vol. 17(5), pages 713-740, October. [Downloadable!] (restricted)
  2. Cohen, Daniel & Sachs, Jeffrey, 1986. "Growth and external debt under risk of debt repudiation," European Economic Review, Elsevier, vol. 30(3), pages 529-560, June. [Downloadable!] (restricted)
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  3. Philip R. Lane & Gian Maria Milesi-Ferretti, 2000. "The Transfer Problem Revisited: Net Foreign Assets and Real Exchange Rates," Working Papers 062000, Hong Kong Institute for Monetary Research. [Downloadable!]
    Other versions:
  4. Mark P. Taylor & Michael J. Artis, 1993. "DEER Hunting - Misalignment, Debt Accumulation, and Desired Equilibrium Exchange Rates," IMF Working Papers 93/48, International Monetary Fund.
  5. Sargent, Thomas J & Wallace, Neil, 1982. "The Real-Bills Doctrine versus the Quantity Theory: A Reconsideration," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1212-36, December. [Downloadable!] (restricted)
  6. Obstfeld, Maurice & Rogoff, Kenneth, 1995. "Exchange Rate Dynamics Redux," CEPR Discussion Papers 1131, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  7. Khalid Sekkat & Aristomène Varoudakis, 1998. "Exchange-Rate Management and Manufactured Exports in Sub-Saharan Africa," OECD Development Centre Working Papers 134, OECD, Development Centre. [Downloadable!]
    Other versions:
  8. Joannes Mongardini, 1998. "Estimating Egypt's Equilibrium Real Exchange Rate," IMF Working Papers 98/5, International Monetary Fund.
  9. Lane, Philip R., 2001. "The new open economy macroeconomics: a survey," Journal of International Economics, Elsevier, vol. 54(2), pages 235-266, August. [Downloadable!] (restricted)
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  10. Virginie Coudert, 1999. "Comment definir un taux de change d'equilibre pour les pays emergents ?," Economie Internationale, CEPII research center, issue 1Q, pages 45-66. [Downloadable!]
  11. Edwards, Sebastian, 1989. "Exchange Rate Misalignment in Developing Countries," World Bank Research Observer, Oxford University Press, vol. 4(1), pages 3-21, January.
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  12. Catherine A. Pattillo & Hélène Poirson & Luca Antonio Ricci, 2002. "External Debt and Growth," IMF Working Papers 02/69, International Monetary Fund.
  13. Cohen, Daniel, 1995. "Large external debt and (slow) domestic growth a theoretical analysis," Journal of Economic Dynamics and Control, Elsevier, vol. 19(5-7), pages 1141-1163. [Downloadable!] (restricted)
  14. Paul Krugman, 1988. "Adjustment in the World Economy," NBER Working Papers 2424, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  15. John T. Cuddington, 1997. "Analysing the Sustainability of Fiscal Deficits in Developing Countries," International Finance 9706001, EconWPA. [Downloadable!]
  16. Devarajan, Shantayanan & Lewis, Jeffrey D & Robinson, Sherman, 1993. "External Shocks, Purchasing Power Parity, and the Equilibrium Real Exchange Rate," World Bank Economic Review, Oxford University Press, vol. 7(1), pages 45-63, January.
  17. Giovanni Ganelli, 2002. "The New Open Economy Macroeconomics of Government Debt," Trinity Economics Papers 200214, Trinity College Dublin, Department of Economics. [Downloadable!]
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