The Impact of Real Effective Exchange Rate on the Non-oil Export: The Case of Azerbaijan

Fakhri Hasanov ()

MPRA Paper from University Library of Munich, Germany

Abstract: The paper investigates the impact of the real exchange rate on non-oil exports in Azerbaijan by applying Vector Error Correction Model. The estimation results suggest that real exchange rate of manat has negative impact on non-oil export performance while non-oil GDP affects positively in the long- and short-run. Error correction term indicates that short-run fluctuation can be adjusted into long-run equilibrium relationship. Based on findings of the study can be concluded that appreciating real exchange rate is one of major factors that impede non-oil export growth. Since promotion of non-oil export is one of the urgent issues of the strategic economic policy of Azerbaijan Republic then findings of the study may be useful for policymakers.

Keywords: Azerbaijani economy; Non-oil export; Real effective exchange rate; Non-oil GDP; Dutch Disease; Vector Error Correction Model. (search for similar items in EconPapers)
JEL-codes: C32 F41 O24 P28 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (16)

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https://mpra.ub.uni-muenchen.de/79559/1/MPRA_paper_29556.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:29556

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