{
  "title": "Exchange Rate Misalignment: An Application of the Behavioral Equilibrium Exchange Rate (BEER) to Botswana",
  "publication": "IMF Working Papers, June 1, 2006",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/exchange-rate-misalignment-an-application-of-the-behavioral-equilibrium-exchange-rate-beer-19208",
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  "summary": "Botswana's successive currency devaluations and recent move from a fixed to a crawling peg exchange rate regime raise the question of whether the exchange rate might be misaligned with economic fundamentals.",
  "sections": [
    {
      "heading": "Summary and key findings",
      "content": "- Applies the behavioral equilibrium exchange rate (BEER) approach to analyze the behavior of the real exchange rate for the period 1985-2004.\n- Finds that the pula was undervalued in the later 1980s.\n- Finds that the pula was overvalued in recent years (relative to the study period).\n- Context: Botswana's successive currency devaluations and move from a fixed to a crawling peg exchange rate regime raise the question of potential misalignment with economic fundamentals.\n- Considers policy lessons from experiences in other countries with crawling peg arrangements in the context of Botswana."
    },
    {
      "heading": "Methodology",
      "content": "- Empirical approach: behavioral equilibrium exchange rate (BEER).\n- Sample period: 1985-2004."
    },
    {
      "heading": "Policy implications and discussion",
      "content": "- Evaluates exchange rate misalignment in light of Botswana's shift from a fixed to a crawling peg regime.\n- Discusses policy lessons from other countries' experiences with crawling peg arrangements, applied to Botswana's context.\n\n---\n\n Content in this bundle\n\n- wp06140\n  - wp06140 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp06140 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/exchange-rate-misalignment-an-application-of-the-behavioral-equilibrium-exchange-rate-beer-19208"
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    "[Markdown version](/en/publications/wp/issues/2016/12/31/exchange-rate-misalignment-an-application-of-the-behavioral-equilibrium-exchange-rate-beer-19208/index.md)",
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    "Authors: Atsushi Iimi",
    "Published: June 1, 2006",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451864007.001",
    "Applies the behavioral equilibrium exchange rate (BEER) approach to analyze the behavior of the real exchange rate for the period 1985-2004.",
    "Finds that the pula was undervalued in the later 1980s.",
    "Finds that the pula was overvalued in recent years (relative to the study period).",
    "Context: Botswana's successive currency devaluations and move from a fixed to a crawling peg exchange rate regime raise the question of potential misalignment with economic fundamentals.",
    "Considers policy lessons from experiences in other countries with crawling peg arrangements in the context of Botswana.",
    "Empirical approach: behavioral equilibrium exchange rate (BEER).",
    "Sample period: 1985-2004.",
    "Evaluates exchange rate misalignment in light of Botswana's shift from a fixed to a crawling peg regime.",
    "Discusses policy lessons from other countries' experiences with crawling peg arrangements, applied to Botswana's context.",
    "**_wp06140**"
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