Logo
Munich Personal RePEc Archive

Determinants of real exchange rate misalignment: An empirical analysis for MENA region

Slimani, Slah and Ben Allem, Khawla (2018): Determinants of real exchange rate misalignment: An empirical analysis for MENA region.

[thumbnail of MPRA_paper_91605.pdf] PDF
MPRA_paper_91605.pdf

Download (455kB)

Abstract

The purpose of this paper is to explain the magnitude of the misalignment of the real exchange rate and its determinants for the MENA countries. Misalignment is defined as the deviation of the real exchange rate from its equilibrium level, unlike volatility which is defined as fluctuations that are very frequent but do not persist. Through this study, an attempt is made to broaden the traditional analysis, focusing mainly on the role of the exchange rate regimes on misalignment of the REER. On the same point of view, the roles of the persistence of misalignment, the quality of institutions, financial development and inflation in the misalignment of the real equilibrium exchange rate of the region. The results of the empirical analysis show that the most advantageous exchange rate regime for the MENA countries is the floating regime. Also, the quality of institutions, financial development and inflation are determinants of the shift of the REER from its equilibrium value.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.