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ANALYSIS OF THE MACROECNOMIC ENVIRONMENT

Competitiveness and equilibrium real exchange rate for Bolivia

In this work, the degree of misalignment of the real exchange rate with respect to its equilibrium value is determined. To do this, based on considerations of economic theory, an Autoregressive Vector Model with Error Correction was formulated and estimated econometrically, given the existence of Cointegration between the model's endogenous variables. The model was applied to determine the impact that the terms of trade of competitive and non-competitive exports have on the real exchange rate (REER) and to verify compliance with the Balassa - Samuelson Effect for the Bolivian economy, in addition to estimating the time required for the real exchange rate (REER) to return to its equilibrium value after a shock.
 
References about the project: CIEE Director


Responsible:
Ernesto Cupé Clemente, MSc.
 
Researchers:
Oscar Martinez, Lic.
Ernesto Cupé Clemente, MSc.