Tunisia: Sources of Real Exchange Rate Fluctuations

Sfia Mohamed Daly ()

No wp880, William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan Stephen M. Ross Business School

Abstract: Using structural VARs identified with long-run restrictions, this paper evaluates the importance of nominal shocks and real disturbances on the Tunisian Dinar during the nineties. The estimated macroeconomic behaviour in response to the shocks identified with a Clarida and Gali–type structural VAR for Tunisia is generally in line with theoretical priors stemming from the Mundell-Fleming model. The structural decomposition shows that relative real demand and supply shocks account for most of the variations in real exchange rate changes during the estimation period and indicates that real disturbances explain about 80% of the variance of the forecast error of the real exchange rate.

Keywords: Tunisia; real exchange rate; structural VAR (search for similar items in EconPapers)
JEL-codes: F41 (search for similar items in EconPapers)
Date: 2006-03-01

Downloads: (external link)
http://www.wdi.umich.edu/files/Publications/WorkingPapers/wp880.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Access Statistics for this paper

More papers in William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan Stephen M. Ross Business School
Contact information at EDIRC.
Series data maintained by Patricia Loh ().