Tunisia: Selected Issues
June 17, 2002
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This Selected Issues paper for Tunisia presents a literary survey of the research on constant real exchange rate rule (CRERR). It assesses Tunisia’s experience with CRERR in terms of inflation performance and discusses possible reasons for Tunisia’s apparent success at avoiding the pitfalls of CRERR as predicted by the theoretical models. The paper presents a regression analysis estimating the equilibrium real exchange rate based on different fundamental variables and compares this with the path of the actual exchange rate. The paper also assesses Tunisia’s external competitiveness over the past decade using a range of indicators.
Subject: Balance of payments, Capital account liberalization, Exchange rates, Foreign exchange, Inflation, Prices, Real effective exchange rates, Real exchange rates
Keywords: Africa, Capital account liberalization, CR, equilibrium exchange rate, excess demand, exchange rate, Exchange rates, GDP deflator, goods, goods export, Inflation, ISCR, liberalization of the capital account, Middle East, nominal exchange rate, North Africa, price, rate depreciation, Real effective exchange rates, Real exchange rates, Tunisia, wage-price-exchange rate spiral
Pages:
69
Volume:
2002
DOI:
Issue:
120
Series:
Country Report No. 2002/120
Stock No:
1TUNEA0022002
ISBN:
9781451837834
ISSN:
1934-7685
