Real exchange rate effect on economic growth: comparison of fundamental equilibrium exchange rate and Balassa–Samuelson based Rodrik approach

Seraj, Mehdi; Coşkuner, Çağay

doi:10.1080/15140326.2021.1977083

Cited by 7 publications

(6 citation statements)

References 30 publications

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“…This may result in adjustments to visitors' travel plans while in a particular nation [93]. These findings corroborate those of Lin, Liu, and Song [94], Meo et al [95], Sharma and Pal [96], Chi [43], and Seraj and Coskuner [97]. For EAP countries, tourism increases economic growth by 0.62%, on average, ceteris paribus.…”

Section: Plos Onesupporting

confidence: 82%

“…For EAP countries, tourism increases economic growth by 0.62%, on average, ceteris paribus. On the other hand, the coefficient of the exchange rate is negative and significant at 1 per cent, which supports the argument of Vieira et al [98] and Seraj and Coskuner [97]. These studies contend that local currency appreciation will decrease the…”

Section: Plos Onesupporting

confidence: 78%

“…In South Asia, the effect of tourism on growth is positive but statistically not significant but exchange rate significantly boosts growth by 0.007%, on average, ceteris paribus. This finding contradicts Seraj and Coskuner [97] and suggests that currency appreciation is growth-enhancing. For the moderation models, columns [3,6,9] reveal that the interaction effect is positive but statistically not different from zero for the full and EAP samples while it decreases growth in South Asia which contradicts Sharma, Vashishat, and Rishad [99].…”

Section: Plos Onementioning

confidence: 61%

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Moderation analysis of exchange rate, tourism and economic growth in Asia

et al. 2022

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This study brings novelty to the tourism literature by re-examining the role of exchange rate in the tourism-growth nexus. It differs from previous tourism-led growth narrative to probe whether tourism exerts a positive effect on economic growth when the exchange rate is accounted for. Using a moderation modelling framework, instrumental variables general method of moments (IV-GMM) and quantile regression techniques in addition to real per capita GDP, tourism receipts and exchange rate, the study engages data on 44 Asian countries from 2010 to 2019. Results from the IV-GMM show that: (1) tourism exerts a positive effect on growth; (2) exchange rate depreciation hampers growth; (3) the interaction effect is positive but statistically not significant; and (4) results from EAP and SA samples are mixed. For the most part, constructive evidence from the quantile regression techniques reveals that the impact of tourism and exchange is significant at lower quantiles of 0.25 and 0.50 while the interaction effect is negative and statistically significant only for the SA sample. These are new contributions to the literature and policy recommendations are discussed.

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Section: Plos Onesupporting

confidence: 82%

Section: Plos Onesupporting

confidence: 78%

Section: Plos Onementioning

confidence: 61%

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Moderation analysis of exchange rate, tourism and economic growth in Asia

et al. 2022

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“…Conversely, the real exchange rate engages in a comprehensive assessment, capturing the proportional relationship between the purchasing power of currencies while concurrently integrating the prevailing price levels. Notably, the real exchange rate occupies a central locus in the purview of policymakers due to its intrinsic adjustment for inflationary dynamics (Seraj and Coskuner, 2021).…”

Section: Introductionmentioning

confidence: 99%

Macroeconomic determinants of the real exchange rate in Pakistan

Munir¹,

Iftikhar²

2023

Int. j. adv. appl. sci.

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This research endeavors to comprehensively examine the macroeconomic determinants that influence the real exchange rate in Pakistan over an extended temporal horizon. By employing quarterly data spanning from the first quarter of 1980 to the fourth quarter of 2020, this study employs the autoregressive distributed lag (ARDL) methodology to discern both immediate and enduring determinants of the real exchange rate. The findings distinctly reveal that variables such as money supply, trade openness, workers' remittances, and productivity collectively constitute the long-term determinants of the real exchange rate in the context of Pakistan. Specifically, an augmentation in money supply and an escalated level of economic openness manifestly contribute to the reduction of the real exchange rate, whereas an inflow of remittances and heightened productivity exhibit the propensity to elevate the real exchange rate over an extended duration. This exploration underscores the imperative for proactive engagement by the nation's monetary authorities within the foreign exchange market, with the overarching objective of preserving the currency's value at a state of equilibrium and, thereby, ensuring the holistic integrity of the economy.

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“…It is the price of a domestic currency compared with an international currency. In addition, when the foreign exchange rate fluctuates, it causes many effects on economic issues such as inflations, interest rates, unemployment, and monetary supply (Ahmad et al, 2014;Kruskovic and Maricic, 2015;Seraj and Coskuner, 2021). These economic issues indicate the importance of foreign exchange rates for the economic growth of the countries, especially in globalization, all nations open doors for international transactions.…”

Section: Introductionmentioning

confidence: 99%

The impact of foreign exchange rate on a balance of payments: Issues from Vietnam

Nguyen¹,

Dang²

2022

Int. j. adv. appl. sci.

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The foreign exchange rate always changes and impacts many economic issues. One of these issues is the impact of the foreign exchange rate on the balance of payments. Our research focuses on the impact of the exchange rate on Vietnam’s balance of payments. All data was collected from the Vietnamese State Bank in the period from 2000 to 2020. We applied the model with the unit root, Auto-Regressive Distributed Lag (ARDL), and Granger Causality Test to evaluate the impact of the foreign exchange rate on the balance of payments. The findings indicated that Vietnam’s foreign exchange rate has a significant positive impact on the balance of payment. The result implied that when the foreign exchange rate is stable, it seems to create a developed and effective economic environment. All these contributions are an important base for improving Vietnam’s balance of payments as well as Vietnam’s economy. By deeply analyzing issues of Vietnam’s foreign exchange rate and its effect, we propose some orientations and solutions for Vietnam’s government and managers in issuing suitable economic policies in the future.

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Real exchange rate effect on economic growth: comparison of fundamental equilibrium exchange rate and Balassa–Samuelson based Rodrik approach

Cited by 7 publications

References 30 publications

Moderation analysis of exchange rate, tourism and economic growth in Asia

Moderation analysis of exchange rate, tourism and economic growth in Asia

Macroeconomic determinants of the real exchange rate in Pakistan

The impact of foreign exchange rate on a balance of payments: Issues from Vietnam

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