Growth and exchange rate volatility: a panel data analysis

Márcio Holland (), Flavio Vieira, Cleomar Gomes da Silva and Luiz Carlos Tadeu Bottecchia Filho

No 296, Textos para discussão from FGV EESP - Escola de Economia de São Paulo, Fundação Getulio Vargas (Brazil)

Abstract: The aim of this article is to assess the role of real effective exchange rate volatility on long-run economic growth for a set of 82 advanced and emerging economies using a panel data set ranging from 1970 to 2009. With an accurate measure for exchange rate volatility, the results for the two-step system GMM panel growth models show that a more (less) volatile RER has significant negative (positive) impact on economic growth and the results are robust for different model specifications. In addition to that, exchange rate stability seems to be more important to foster long-run economic growth than exchange rate misalignment

Date: 2011-08-04
New Economics Papers: this item is included in nep-fdg
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Citations: View citations in EconPapers (12)

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Journal Article: Growth and exchange rate volatility: a panel data analysis (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:fgv:eesptd:296

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