Measuring exchange rate misalignment
By: Umit Ozale and Erinc Yeldan.
Contributors: Yeldan, Erinç, 1960-
Series: Working paper ;; 0206; Working paper (Economic Research Forum for the Arab Countries, Iran, and Turkey : Online) ;; 0206.
Publisher: Economic Research Forum for the Arab Countries, Iran & Turkey
Published: 2002
Place of publication: Cairo, Egypt
Language: eng
Format: Electronic resource
Number of pages: 24
Subjects: Foreign exchange rates -- Turkey -- Statistical methods.
Description: "We propose a new methodology to measure exchange rate misalignment for Turkey, which has already undergone a severe economic crisis.  We estimate the real exchange rate within a time varying parameter model, where a return-to-normality assumption about the parameters are assumed.  Contrary to common belief, it is found that, except the initial four months of the stabilization program, the Turkish Lira remained structurally undervalued for most of 2000.  Also, we observe a pattern where the Lira has been structurally overvalued after the crisis in 1994 until 1998, and has displayed structural undervaluation after that"-- Economic Research Forum for the Arab Countries, Iran and Turkey web site.
Notes: Includes bibliographical references.
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