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Are Exchange Rate, Exports and Domestic Investment in Tunisia Cointegrated? A Comparison of ECM and ARDL Model

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  • Bakari, Sayef
  • Tiba, Sofien

Abstract

The objective of the paper is to investigate the effect of the exchange rate, exports, and domestic investment by adopting a comparative approach between the ECM and ARDL procedure for the case of the Tunisian economy during the period of study1966-2017. Our insights of Error Correction Model recorded that the Domestic Investment and Exports have a negative impact on Exchange Rate. In accordance with the highlights of the ARDL model. Understanding these controversial nexus seems to be vitality, especially, for this current critical situation of the Tunisian economy.

Suggested Citation

  • Bakari, Sayef & Tiba, Sofien, 2019. "Are Exchange Rate, Exports and Domestic Investment in Tunisia Cointegrated? A Comparison of ECM and ARDL Model," MPRA Paper 96619, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:96619
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    File URL: https://mpra.ub.uni-muenchen.de/96619/1/MPRA_paper_96619.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Exchange rate; Exports; Domestic investment; ECM; ARDL.;

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • F00 - International Economics - - General - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F68 - International Economics - - Economic Impacts of Globalization - - - Policy

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