Exchange rate misalignment in Pakistan and its general equilibrium distributional implications
2014
Debowicz, Dario; Saeed, Wajiha
IFPRI1; PSSP
Mostrar más [+] Menos [-]Recent findings in the growth literature suggest that developing countries need to keep a devalued exchange rate to stimulate their economic growth. Building on these findings, we econometrically evaluate to what ex-tent the real exchange rate of Pakistan has been aligned with its economic fundamentals, and find that the Pa-kistan rupee has been significantly and systematically overvalued during the last years. We then simulate the general equilibrium effects of an eventual re-alignment of the real exchange rate with economic fundamen-tals, and find not only an expected increase in the relative size of the tradable sector - where productivity in-creases tend to be faster – but also an associated improvement in the income of the poorest groups.
Mostrar más [+] Menos [-]Working paper
Mostrar más [+] Menos [-]Non-PR
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Información bibliográfica
Este registro bibliográfico ha sido proporcionado por International Food Policy Research Institute