Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius

The authors estimate a VAR and compute generalized impulse response to analyze the joint dynamics of four key macroeconomic variables in the small open economy of Mauritius. Results suggest that nominal exchange rate and interest rate have limited...

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Main Authors:	Bastos, Fabiano, Angelo Divino, Jose
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNTING AGGREGATE DEMAND BANK POLICY BANKING SECTOR BASIS POINT CAPITAL ACCOUNT CAPITAL ACCOUNTS CAPITAL BASE CENTRAL BANK COMMODITY COMPETITIVENESS CONSUMER PRICE INDEX COVARIANCE MATRIX CURRENCY DEPRECIATION DEVALUATION DEVALUATIONS DISTORTIONS DOMESTIC CAPITAL DOMESTIC ECONOMY DOMESTIC MARKETS DOMESTIC PRICES DUMMY VARIABLE DUMMY VARIABLES ECONOMETRICS ECONOMIC CRISIS ECONOMIC DOWNTURN ECONOMIC ENVIRONMENT ECONOMIC PERFORMANCE ECONOMIC SLOWDOWN EQUILIBRIUM CONDITIONS EXCHANGE RATE EXCHANGE RATE DEVALUATION EXCHANGE RATE DEVALUATIONS EXCHANGE RATE FLUCTUATIONS EXCHANGE RATE SHOCKS EXCHANGE RATES EXCHANGE-RATE EXOGENOUS VARIABLE EXOGENOUS VARIABLES EXPORT MARKETS EXPORT PERFORMANCE EXPORT SECTOR EXPORTS EXTERNAL DEMAND EXTERNAL EQUILIBRIUM FINANCIAL MARKETS FISCAL STIMULUS GDP GDP DEFLATOR GDP PER CAPITA GROWTH POTENTIAL HUMAN CAPITAL IMPORT INFLATION INFLATION RATE INFLATIONARY PRESSURE INFLATIONARY PRESSURES INFRASTRUCTURE INVESTMENT INTEREST RATE INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL PRICE INTERNATIONAL TRADE LIQUIDITY MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC VARIABLES MACROECONOMICS MARKET FORCES MONETARY ECONOMICS MONETARY POLICIES MONETARY POLICY MONETARY TRANSMISSION MULTIPLE POLICY NEGATIVE SHOCKS NOMINAL DEPRECIATION NOMINAL EXCHANGE RATE NOMINAL EXCHANGE RATES NOMINAL INTEREST RATE OIL PRICE OIL PRICES OPEN ECONOMY OUTPUT POLICY RESPONSE PORTFOLIO POVERTY REDUCTION PREFERENTIAL MARKET ACCESS PRICE LEVELS PRIVATE SECTOR DEVELOPMENT PUBLIC SECTOR REAL EXCHANGE RATE REAL EXCHANGE RATES RECESSION REGULATORY ENVIRONMENT REJECTIONS SOCIAL COSTS STANDARD DEVIATIONS TRADING TRADING PARTNERS TRANSMISSION MECHANISM VALUE ADDED
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090928161216 http://hdl.handle.net/10986/4256

id	okr-10986-4256
recordtype	oai_dc
spelling	okr-10986-42562021-04-23T14:02:16Z Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius Bastos, Fabiano Angelo Divino, Jose ACCOUNTING AGGREGATE DEMAND BANK POLICY BANKING SECTOR BASIS POINT CAPITAL ACCOUNT CAPITAL ACCOUNTS CAPITAL BASE CENTRAL BANK COMMODITY COMPETITIVENESS CONSUMER PRICE INDEX COVARIANCE MATRIX CURRENCY DEPRECIATION DEVALUATION DEVALUATIONS DISTORTIONS DOMESTIC CAPITAL DOMESTIC ECONOMY DOMESTIC MARKETS DOMESTIC PRICES DUMMY VARIABLE DUMMY VARIABLES ECONOMETRICS ECONOMIC CRISIS ECONOMIC DOWNTURN ECONOMIC ENVIRONMENT ECONOMIC PERFORMANCE ECONOMIC SLOWDOWN EQUILIBRIUM CONDITIONS EXCHANGE RATE EXCHANGE RATE DEVALUATION EXCHANGE RATE DEVALUATIONS EXCHANGE RATE FLUCTUATIONS EXCHANGE RATE SHOCKS EXCHANGE RATES EXCHANGE-RATE EXOGENOUS VARIABLE EXOGENOUS VARIABLES EXPORT MARKETS EXPORT PERFORMANCE EXPORT SECTOR EXPORTS EXTERNAL DEMAND EXTERNAL EQUILIBRIUM FINANCIAL MARKETS FISCAL STIMULUS GDP GDP DEFLATOR GDP PER CAPITA GROWTH POTENTIAL HUMAN CAPITAL IMPORT INFLATION INFLATION RATE INFLATIONARY PRESSURE INFLATIONARY PRESSURES INFRASTRUCTURE INVESTMENT INTEREST RATE INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL PRICE INTERNATIONAL TRADE LIQUIDITY MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC VARIABLES MACROECONOMICS MARKET FORCES MONETARY ECONOMICS MONETARY POLICIES MONETARY POLICY MONETARY TRANSMISSION MULTIPLE POLICY NEGATIVE SHOCKS NOMINAL DEPRECIATION NOMINAL EXCHANGE RATE NOMINAL EXCHANGE RATES NOMINAL INTEREST RATE OIL PRICE OIL PRICES OPEN ECONOMY OUTPUT POLICY RESPONSE PORTFOLIO POVERTY REDUCTION PREFERENTIAL MARKET ACCESS PRICE LEVELS PRIVATE SECTOR DEVELOPMENT PUBLIC SECTOR REAL EXCHANGE RATE REAL EXCHANGE RATES RECESSION REGULATORY ENVIRONMENT REJECTIONS SOCIAL COSTS STANDARD DEVIATIONS TRADING TRADING PARTNERS TRANSMISSION MECHANISM VALUE ADDED The authors estimate a VAR and compute generalized impulse response to analyze the joint dynamics of four key macroeconomic variables in the small open economy of Mauritius. Results suggest that nominal exchange rate and interest rate have limited ability to impact output growth over the medium-run. Large error bands hinder analysis of the inflation output trade-off, but evidence points to a weak relationship in the short run as well. These findings are used to shed some light into the policy response to the current worldwide economic slowdown affecting Mauritius. 2012-03-19T19:12:43Z 2012-03-19T19:12:43Z 2009-09-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090928161216 http://hdl.handle.net/10986/4256 English Policy Research working paper ; no. WPS 5065 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper Africa Africa Sub-Saharan Africa East Africa Mauritius
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTING AGGREGATE DEMAND BANK POLICY BANKING SECTOR BASIS POINT CAPITAL ACCOUNT CAPITAL ACCOUNTS CAPITAL BASE CENTRAL BANK COMMODITY COMPETITIVENESS CONSUMER PRICE INDEX COVARIANCE MATRIX CURRENCY DEPRECIATION DEVALUATION DEVALUATIONS DISTORTIONS DOMESTIC CAPITAL DOMESTIC ECONOMY DOMESTIC MARKETS DOMESTIC PRICES DUMMY VARIABLE DUMMY VARIABLES ECONOMETRICS ECONOMIC CRISIS ECONOMIC DOWNTURN ECONOMIC ENVIRONMENT ECONOMIC PERFORMANCE ECONOMIC SLOWDOWN EQUILIBRIUM CONDITIONS EXCHANGE RATE EXCHANGE RATE DEVALUATION EXCHANGE RATE DEVALUATIONS EXCHANGE RATE FLUCTUATIONS EXCHANGE RATE SHOCKS EXCHANGE RATES EXCHANGE-RATE EXOGENOUS VARIABLE EXOGENOUS VARIABLES EXPORT MARKETS EXPORT PERFORMANCE EXPORT SECTOR EXPORTS EXTERNAL DEMAND EXTERNAL EQUILIBRIUM FINANCIAL MARKETS FISCAL STIMULUS GDP GDP DEFLATOR GDP PER CAPITA GROWTH POTENTIAL HUMAN CAPITAL IMPORT INFLATION INFLATION RATE INFLATIONARY PRESSURE INFLATIONARY PRESSURES INFRASTRUCTURE INVESTMENT INTEREST RATE INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL PRICE INTERNATIONAL TRADE LIQUIDITY MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC VARIABLES MACROECONOMICS MARKET FORCES MONETARY ECONOMICS MONETARY POLICIES MONETARY POLICY MONETARY TRANSMISSION MULTIPLE POLICY NEGATIVE SHOCKS NOMINAL DEPRECIATION NOMINAL EXCHANGE RATE NOMINAL EXCHANGE RATES NOMINAL INTEREST RATE OIL PRICE OIL PRICES OPEN ECONOMY OUTPUT POLICY RESPONSE PORTFOLIO POVERTY REDUCTION PREFERENTIAL MARKET ACCESS PRICE LEVELS PRIVATE SECTOR DEVELOPMENT PUBLIC SECTOR REAL EXCHANGE RATE REAL EXCHANGE RATES RECESSION REGULATORY ENVIRONMENT REJECTIONS SOCIAL COSTS STANDARD DEVIATIONS TRADING TRADING PARTNERS TRANSMISSION MECHANISM VALUE ADDED
spellingShingle	ACCOUNTING AGGREGATE DEMAND BANK POLICY BANKING SECTOR BASIS POINT CAPITAL ACCOUNT CAPITAL ACCOUNTS CAPITAL BASE CENTRAL BANK COMMODITY COMPETITIVENESS CONSUMER PRICE INDEX COVARIANCE MATRIX CURRENCY DEPRECIATION DEVALUATION DEVALUATIONS DISTORTIONS DOMESTIC CAPITAL DOMESTIC ECONOMY DOMESTIC MARKETS DOMESTIC PRICES DUMMY VARIABLE DUMMY VARIABLES ECONOMETRICS ECONOMIC CRISIS ECONOMIC DOWNTURN ECONOMIC ENVIRONMENT ECONOMIC PERFORMANCE ECONOMIC SLOWDOWN EQUILIBRIUM CONDITIONS EXCHANGE RATE EXCHANGE RATE DEVALUATION EXCHANGE RATE DEVALUATIONS EXCHANGE RATE FLUCTUATIONS EXCHANGE RATE SHOCKS EXCHANGE RATES EXCHANGE-RATE EXOGENOUS VARIABLE EXOGENOUS VARIABLES EXPORT MARKETS EXPORT PERFORMANCE EXPORT SECTOR EXPORTS EXTERNAL DEMAND EXTERNAL EQUILIBRIUM FINANCIAL MARKETS FISCAL STIMULUS GDP GDP DEFLATOR GDP PER CAPITA GROWTH POTENTIAL HUMAN CAPITAL IMPORT INFLATION INFLATION RATE INFLATIONARY PRESSURE INFLATIONARY PRESSURES INFRASTRUCTURE INVESTMENT INTEREST RATE INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL PRICE INTERNATIONAL TRADE LIQUIDITY MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC VARIABLES MACROECONOMICS MARKET FORCES MONETARY ECONOMICS MONETARY POLICIES MONETARY POLICY MONETARY TRANSMISSION MULTIPLE POLICY NEGATIVE SHOCKS NOMINAL DEPRECIATION NOMINAL EXCHANGE RATE NOMINAL EXCHANGE RATES NOMINAL INTEREST RATE OIL PRICE OIL PRICES OPEN ECONOMY OUTPUT POLICY RESPONSE PORTFOLIO POVERTY REDUCTION PREFERENTIAL MARKET ACCESS PRICE LEVELS PRIVATE SECTOR DEVELOPMENT PUBLIC SECTOR REAL EXCHANGE RATE REAL EXCHANGE RATES RECESSION REGULATORY ENVIRONMENT REJECTIONS SOCIAL COSTS STANDARD DEVIATIONS TRADING TRADING PARTNERS TRANSMISSION MECHANISM VALUE ADDED Bastos, Fabiano Angelo Divino, Jose Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
geographic_facet	Africa Africa Sub-Saharan Africa East Africa Mauritius
relation	Policy Research working paper ; no. WPS 5065
description	The authors estimate a VAR and compute generalized impulse response to analyze the joint dynamics of four key macroeconomic variables in the small open economy of Mauritius. Results suggest that nominal exchange rate and interest rate have limited ability to impact output growth over the medium-run. Large error bands hinder analysis of the inflation output trade-off, but evidence points to a weak relationship in the short run as well. These findings are used to shed some light into the policy response to the current worldwide economic slowdown affecting Mauritius.
format	Publications & Research :: Policy Research Working Paper
author	Bastos, Fabiano Angelo Divino, Jose
author_facet	Bastos, Fabiano Angelo Divino, Jose
author_sort	Bastos, Fabiano
title	Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
title_short	Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
title_full	Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
title_fullStr	Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
title_full_unstemmed	Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
title_sort	exchange rate and output fluctuations in the small open economy of mauritius
publishDate	2012
url	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090928161216 http://hdl.handle.net/10986/4256
_version_	1764390621939761152

Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius

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