EXCHANGE RATE FLUCTUATIONS AND ECONOMIC ACTIVITY IN DEVELOPING COUNTRIES: THEORY AND EVIDENCE

Magda Elsayed Kandil

74 citations0/0 files storedRePEc: Research Papers in Economics

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Monetary Policy and Economic Impact Global Financial Crisis and Policies Economic Theory and Policy

Abstract

This paper examines the effects of exchange rate fluctuations on real output growth and price inflation in a sample of twenty-two developing countries. The analysis introduces a theoretical rational expectation model that decomposes movements in the exchange rate into anticipated and unanticipated components. The model demonstrates the effects of demand and supply channels on the output and price responses to changes in the exchange rate. In general, exchange rate depreciation, both anticipated and unanticipated, decreases real output growth and increases price inflation. The evidence confirms concerns about the negative effects of currency depreciation on economic performance in developing countries.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 74 citations exist upstream.

References

1992Testing the null hypothesis of stationarity against the alternative of a unit root 1991Testing the Null Hypothesis of Stationarity Against the Alternative of a Unit Root: How Sure Are We That Economic Time Series Have a Unit Root?1978Contractionary effects of devaluation 1996OPEN-ECONOMY MACROECONOMICS 1963A Note on the Impact of Devaluation and the Redistributive Effect 1957The Theory of International Economic Policy 1988Contractionary Devaluation in Developing Countries: An Analytical Overview 1986Exchange rate management and stabilization policies in developing countries

Cited by

2018A stock market risk forecasting model through integration of switching regime, ANFIS and GARCH techniques 2008Are devaluations contractionary in MENA countries?2016Exchange rate fluctuations and macroeconomic performance 2014Impact of exchange rate depreciation on the balance of payments: Empirical evidence from Nigeria 2013The Effect of Exchange Rate on Exports and Imports: The Case of Jordan

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.