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Productivity and the New Zealand Dollar: Balassa-Samuelson tests on sectoral data

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Abstract

The Balassa-Samuelson hypothesis suggests that countries with a weak relative productivity performance should, over time, see a low or falling real exchange rate. This note uses detailed sectoral data to test the hypothesis over the period 1978-2006 and also fails to find any evidence of the expected effect.

Suggested Citation

  • Daan Steenkamp, 2013. "Productivity and the New Zealand Dollar: Balassa-Samuelson tests on sectoral data," Reserve Bank of New Zealand Analytical Notes series AN2013/01, Reserve Bank of New Zealand.
    • Handle: RePEc:nzb:nzbans:2013/01
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    References listed on IDEAS

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    14. Balázs Égert, 2002. "Investigating the Balassa‐Samuelson hypothesis in the transition: Do we understand what we see? A panel study," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 10(2), pages 273-309, July.
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    Cited by:

    1. Paul Conway, 2018. "Can the Kiwi Fly? Achieving Productivity Lift-off in New Zealand," International Productivity Monitor, Centre for the Study of Living Standards, vol. 34, pages 40-63, Spring.
    2. Martin Berka & Daan Steenkamp, 2018. "Deviations in real exchange rate levels in the OECD countries and their structural determinants," Working Papers 4, New Zealand Centre of Macroeconomics.
    3. Alberto Naudon & Joaquín Vial, 2016. "The evolution of inflation in Chile since 2000," BIS Papers chapters, in: Bank for International Settlements (ed.), Inflation mechanisms, expectations and monetary policy, volume 89, pages 93-116, Bank for International Settlements.
    4. Daan Steenkamp, 2017. "How bubbly is the New Zealand dollar?," Reserve Bank of New Zealand Discussion Paper Series DP2017/03, Reserve Bank of New Zealand.
    5. David Jacobs & Thomas Williams, 2014. "The Determinants of Non-tradables Inflation," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 27-38, September.

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