Aggregate and sector-specific exchange rate indexes for the Portuguese economy
Economic theory and empirical evidence suggest that fluctuation in exchange rates may have strong reallocation effects. Accession to the Exchange Rate Mechanism in 1992, and then to the European Monetary Union em 1999, implied a drastic change in the behavior of Portugal´s exchange rate indexes. The analysis of those indexes is therefore bound ti play an important role in the study of the evolution of the Portuguese economy in the last two decades. However, there are many alternative exchange rate indexes.In this paper, we compute and compare aggregate and sector-specific exchange rate indexes for the Portuguese economy. We find that alternative effective exchange rate indexes are very similar between them. We also find that sector-specific effective exchange rates are strongly correlated with aggregate indexes. Nevertheless, we show that sector-specific exchange rates are more informative than aggregate exchange rates in explaining changes in employment: whereas aggregate indexes are statistically in employment equations, regressions using sector-specific exchange rate indexes show a statistically significant and economically large effect of exchange rates on employment.
|Date of creation:||2009|
|Contact details of provider:|| Postal: Núcleo de Investigação em Políticas Económicas, Escola de Economia e Gestão, Universidade do Minho, P-4710-057 Braga, Portugal|
Phone: +351-253604510 ext 5532
Web page: http://www3.eeg.uminho.pt/economia/nipe/versao_inglesa/index_uk.htm
More information through EDIRC
|Order Information:|| Email: |
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.:
- Paulo Soares Esteves & Carolina Reis, 2006. "Measuring export competitiveness: revisiting the effective exchange rate weights for the euro area countries," Working Papers w200611, Banco de Portugal, Economics and Research Department.
- Klein, Michael W. & Schuh, Scott & Triest, Robert K., 2003.
"Job creation, job destruction, and the real exchange rate,"
Journal of International Economics,
Elsevier, vol. 59(2), pages 239-265, March.
- Michael W. Klein & Scott Schuh & Robert K. Triest, 1999. "Job creation, job destruction, and the real exchange rate," Working Papers 99-11, Federal Reserve Bank of Boston.
- Michael W. Klein & Scott Schuh & Robert K. Triest, 2000. "Job Creation, Job Destruction, and the Real Exchange Rate," NBER Working Papers 7466, National Bureau of Economic Research, Inc.
- Luca Buldorini & Stelios Makrydakis & Christian Thimann, 2002. "The effective exchange rates of the euro," Occasional Paper Series 02, European Central Bank.
- Jose Manuel Campa & Linda S. Goldberg, 1998.
"Employment versus wage adjustment and the U.S. dollar,"
56, Federal Reserve Bank of New York.
- Jose Manuel Campa & Linda S. Goldberg, 2001. "Employment Versus Wage Adjustment And The U.S. Dollar," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 477-489, August.
- Jose Manuel Campa & Linda S. Goldberg, 1998. "Employment versus Wage Adjustment and the US Dollar," NBER Working Papers 6749, National Bureau of Economic Research, Inc.
- José Manuel Campa & Linda S. Goldberg, 1999. "Employment versus Wage Adjustment and the U.S. Dollar," Working Papers 99-07, New York University, Leonard N. Stern School of Business, Department of Economics.
- Amador, João & Cabral, Sónia & Ramos Maria, José, 2007.
"International Trade Patterns over the Last Four Decades: How does Portugal Compare with other Cohesion Countries?,"
5996, University Library of Munich, Germany.
- João Amador & Sónia Cabral & José R. Maria, 2007. "International Trade Patterns over the Last Four Decades: How does Portugal Compare with other Cohesion Countries?," Working Papers w200714, Banco de Portugal, Economics and Research Department.
- International Monetary Fund, 2005.
"New Rates from New Weights,"
IMF Working Papers
05/99, International Monetary Fund.
- William H. Branson & James Love, 1988. "U.S. Manufacturing and the Real Exchange Rate," NBER Chapters, in: Misalignment of Exchange Rates: Effects on Trade and Industry, pages 241-276 National Bureau of Economic Research, Inc.
- Manuel de Heredia Caldeira Cabral, 2008. "Export Diversification And Technological Improvement: Recent Trends In The Portuguese Economy," GEE Papers 0006, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Apr 2008.
- Linda S. Goldberg, 2004. "Industry-specific exchange rates for the United States," Economic Policy Review, Federal Reserve Bank of New York, issue May, pages 1-16.
- Herman Z Bennett & Ziga Zarnic, 2008.
"International Competitiveness of the Mediterranean Quartet; A Heterogeneous-Product Approach,"
IMF Working Papers
08/240, International Monetary Fund.
- Herman Z Bennett & Ziga Zarnic, 2009. "International Competitiveness of the Mediterranean Quartet: A Heterogeneous-Product Approach," IMF Staff Papers, Palgrave Macmillan, vol. 56(4), pages 919-957, November.
- Ekholm, Karolina & Moxnes, Andreas & Ulltveit-Moe, Karen-Helene, 2008.
"Manufacturing Restructuring and the Role of Real Exchange Rate Shocks,"
CEPR Discussion Papers
6904, C.E.P.R. Discussion Papers.
- Ekholm, Karolina & Moxnes, Andreas & Ulltveit-Moe, Karen Helene, 2012. "Manufacturing restructuring and the role of real exchange rate shocks," Journal of International Economics, Elsevier, vol. 86(1), pages 101-117.
When requesting a correction, please mention this item's handle: RePEc:nip:nipewp:13/2009. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Maria João Thompson)
If references are entirely missing, you can add them using this form.