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Exchange rate undervaluation and manufactured exports: A deliberate strategy?

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  • Nouira, Ridha
  • Plane, Patrick
  • Sekkat, Khalid

Abstract

Recent literature suggests that a proactive exchange rate policy in accordance with price incentives (i.e. undervaluation) can foster manufactured exports and growth. This paper is built on these recent developments and investigates, using a sample of 52 developing countries, whether such a proactive exchange rate policy is adopted. The results show that during the period 1991–2005 a number of countries has used undervaluation to foster the price competitiveness of manufactured exports.

Suggested Citation

  • Nouira, Ridha & Plane, Patrick & Sekkat, Khalid, 2011. "Exchange rate undervaluation and manufactured exports: A deliberate strategy?," Journal of Comparative Economics, Elsevier, vol. 39(4), pages 584-601.
  • Handle: RePEc:eee:jcecon:v:39:y:2011:i:4:p:584-601
    DOI: 10.1016/j.jce.2011.08.002
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    Citations

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    Cited by:

    1. Amelia Nurunnisa & Fithra Faisal Hastiadi, 2016. "Real Exchange Rate, Trade Balance and Deindustrialization in Indonesia," Working Papers in Economics and Business 201604, Faculty of Economics and Business, University of Indonesia, revised Jun 2016.
    2. Abdessalem GOUIDER & Ridha NOUIRA, 2014. "The Impact of Misalignment on FDI in the Developing Countries," International Journal of Economics and Financial Issues, Econjournals, vol. 4(4), pages 784-800.
    3. Sekkat, Khalid, 2016. "Exchange rate misalignment and export diversification in developing countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 59(C), pages 1-14.
    4. repec:cii:cepiei:2015-q1-141-8 is not listed on IDEAS
    5. repec:bla:reviec:v:25:y:2017:i:5:p:949-974 is not listed on IDEAS
    6. A. Wondemu Kifle & Potts David, 2016. "Working Paper 240 - The Impact of the Real Exchange Rate Changes on Export Performance in Tanzania and Ethiopia," Working Paper Series 2348, African Development Bank.
    7. Nouira, Ridha & Sekkat, Khalid, 2012. "Desperately seeking the positive impact of undervaluation on growth," Journal of Macroeconomics, Elsevier, vol. 34(2), pages 537-552.
    8. KAFANDO, Namalguebzanga, 2014. "L'industrialisation de l'Afrique: l'importance des facteurs structurels et du régime de change
      [The industrialization of Africa: the importance of structural factors and exchange rate regime]
      ," MPRA Paper 68736, University Library of Munich, Germany.
    9. repec:eco:journ1:2014-03-09 is not listed on IDEAS
    10. Blaise Gnimassoun, 2017. "Exchange rate misalignments and the external balance under a pegged currency system," Post-Print hal-01665005, HAL.
    11. Slimani, Slah & Ben allem, Khaoula, 2017. "Les déterminants du misalignement du taux de change réel : Analyse empirique pour le cas de la région MENA
      [Determinants of misalignment of the real exchange rate: An empirical analysis for the MEN
      ," MPRA Paper 81247, University Library of Munich, Germany.
    12. Blaise Gnimassoun, 2017. "Exchange rate misalignments and the external balance under a pegged currency system," Review of International Economics, Wiley Blackwell, vol. 25(5), pages 949-974, November.

    More about this item

    Keywords

    Exchange rate; Misalignment; Undervaluation; Exports diversification;

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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