Competitiveness in Bulgaria: An Assessment of the Real Effective Exchange Rate

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Author/Editor: Dimitar Chobanov, Piritta Sorsa
Release Date: © March, 2004
ISBN : 978-1-45184-560-0
Stock #: WPIEA0372004
English
Stock Status: Available

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Description

This paper presents an empirical analysis of the medium- and long-term determinants of the real (effective) exchange rate (RER) of the Bulgarian lev using elements from the natural real exchange rate (NATREX) and the behavioral equilibrium exchange rate (BEER) approaches. The results indicate that the RER is driven by fundamentals, including labor productivity, terms of trade, world real interest rates, gross savings, and foreign direct investment. The model also shows that there is no significant misalignment of the Bulgarian lev.




More publications in this series: Working Papers


More publications by: Dimitar Chobanov ; Piritta Sorsa