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Assessing Competitiveness and Real Exchange Rate Misalignment in Low-Income Countries
Author:
Mr. Mark W Lewis
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Ms. Aurelie Martin
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Gabriel Di Bella null

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Series:
IMF Working Papers
Volume/Issue:
Volume 2007: Issue 201
Language:
English
Publication Date:
01 Aug 2007
DOI:
https://doi.org/10.5089/9781451867657.001
ISBN:
9781451867657
ISSN:
1018-5941
Pages:
46
Keywords:
WP; cost; CPI; exchange rate; competitiveness; competitiveness assessment; Equilibrium Exchange Rates; Low-Income Countries; RER chg; RER misalignment; equilibrium RERS; RER depreciation; RER indicator; RER equilibrium; RER assessment; RER adjustment; RER appreciation; Competition; Real exchange rates; Exports; Exchange rates; Terms of trade; Global
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Assessing a country's competitiveness routinely starts with an analysis of the real exchange rate. However, in low-income countries, empirical analysis of the real exchange rate is often subject to important limitations that seriously weaken the results. This paper summarizes the methodologies used to assess real exchange rate misalignments and discusses the range of obstacles common to low-income countries. Recognizing the importance of using a wide range of indicators for assessing competitiveness in low-income countries, the paper discusses alternative competitive measures and then proposes a template of indicators to allow for a systematic assessment of competitiveness in low-income countries. The template is then used to rank countries according to their competitiveness performance in 2006.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund