EconPapers    
Economics at your fingertips  
 

Macro Determinants Of The Real Exchange Rate In A Small Open Small Island Economy:Evidence From Mauritius Via Bma

Bernard Njindan Iyke ()

Bulletin of Monetary Economics and Banking, 2018, vol. 21, issue 1, 1-24

Abstract: We assess the robust macro determinants of the real exchange rate in Mauritius under model uncertainty by utilizing Bayesian Model Averaging (BMA). We introduce a broader range of potential macro determinants of the real exchange rate in Mauritius. Then we tackle the issue of model uncertainty when identifying these macro determinants of the real exchange rate by exploring the impact of different priors on the model size, and different priors on model coefficients on the posterior estimates. We identify the real money supply, and the real productivity to be the robust macro determinants of the real exchange rate in Mauritius. Their coefficient signs are also theoretically consistent. The real money supply impact on the real exchange rate negatively, whereas the real productivity impact on it positively. Our results remain robust to different priors on the model size, and to different priors on model coefficients.

Keywords: Model Uncertainty; Bayesian Model Averaging (BMA); Macro Determinants; Real Exchange Rate; Mauritius (search for similar items in EconPapers)
JEL-codes: C11 C15 F31 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://www.bmeb-bi.org/index.php/BEMP/article/download/922/708 (application/pdf)

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

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:21:y:2018-12:i:1:p:1-24

DOI: https://doi.org/10.21098/bemp.v21i1.922

Access Statistics for this article

Bulletin of Monetary Economics and Banking is currently edited by Paresh Narayan

More articles in Bulletin of Monetary Economics and Banking from Bank Indonesia Contact information at EDIRC.
Bibliographic data for series maintained by Nurhemi ().

 
Page updated 2019-12-07
Handle: RePEc:idn:journl:v:21:y:2018-12:i:1:p:1-24