{
  "title": "Exchange Rate Misalignment and Growth: A Myth?",
  "publication": "IMF Working Papers, December 21, 2017",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374",
  "canonical": "https://www.imf.org/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374",
  "overlayPath": "/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/index.md",
  "summary": "The impact of real exchange rate movements on GDP growth is a hotly debated issue both in policy and academic circles. In this paper, we provide evidence suggesting that the association between exchange rate misalignment and growth for a broad panel of countries is very weak.",
  "sections": [
    {
      "heading": "Major findings",
      "content": "- The association between exchange rate misalignment (real exchange rate movements) and GDP growth is very weak for a broad panel of countries.\n- Controlling for country fixed effects, time effects and initial GDP, a more depreciated currency is associated with higher growth if outliers are not excluded.\n- The positive association between depreciation and growth always vanishes after controlling for the savings rate.\n- The result that the positive association vanishes after controlling for the savings rate applies both to a large panel of countries and to the emerging economies subsample."
    },
    {
      "heading": "Research design and controls",
      "content": "- Controls explicitly mentioned:\n  - Country fixed effects\n  - Time effects\n  - Initial GDP\n  - Savings rate (in robustness checks)\n- Treatment of outliers:\n  - Positive association between depreciation and growth appears when outliers are not excluded; association disappears when savings rate is controlled for."
    },
    {
      "heading": "Scope and sample",
      "content": "- Analysis covers a broad panel of countries.\n- Separate subsample analysis for emerging economies is reported, with findings similar to the full panel."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Authors: Carlos Goncalves, Mauro Rodrigues\n- Date: December 21, 2017\n- Series: Working Paper No. 2017/283\n- Issue: 283\n- Volume: 2017\n- Pages: 15\n- DOI: https://doi.org/10.5089/9781484330135.001\n- Stock No: WPIEA2017283\n- ISBN: 9781484330135\n- ISSN: 1018-5941\n\nSummary derived from \"Exchange Rate Misalignment and Growth: A Myth?\", IMF Working Papers, December 21, 2017.\n\n---\n\n Content in this bundle\n\n- Exchange Rate Misalignment and Growth: A Myth?, WP/17/283, December 2017\n  - Exchange Rate Misalignment and Growth: A Myth?, WP/17/283, December 2017 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Exchange Rate Misalignment and Growth: A Myth?, WP/17/283, December 2017 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374"
    }
  ],
  "bullets": [
    "[Markdown version](/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/index.md)",
    "[Structured JSON version](/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/index.json)",
    "[Bundle manifest](/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/bundle-manifest.json)",
    "Authors: Carlos Goncalves, Mauro Rodrigues",
    "Published: December 21, 2017",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781484330135.001",
    "The association between exchange rate misalignment (real exchange rate movements) and GDP growth is very weak for a broad panel of countries.",
    "Controlling for country fixed effects, time effects and initial GDP, a more depreciated currency is associated with higher growth if outliers are not excluded.",
    "The positive association between depreciation and growth always vanishes after controlling for the savings rate.",
    "The result that the positive association vanishes after controlling for the savings rate applies both to a large panel of countries and to the emerging economies subsample.",
    "Controls explicitly mentioned:",
    "Treatment of outliers:",
    "Analysis covers a broad panel of countries.",
    "Separate subsample analysis for emerging economies is reported, with findings similar to the full panel.",
    "Authors: Carlos Goncalves, Mauro Rodrigues",
    "Date: December 21, 2017",
    "Series: Working Paper No. 2017/283",
    "Issue: 283",
    "Volume: 2017",
    "Pages: 15",
    "DOI: https://doi.org/10.5089/9781484330135.001",
    "Stock No: WPIEA2017283",
    "ISBN: 9781484330135",
    "ISSN: 1018-5941",
    "**Exchange Rate Misalignment and Growth: A Myth?, WP/17/283, December 2017**"
  ],
  "related": [
    {
      "title": "Exchange Rate Misalignment and Growth: A Myth?, WP/17/283, December 2017",
      "role": "document",
      "sourceUrl": "https://www.imf.org/-/media/files/publications/wp/2017/wp17283.pdf",
      "summary": {
        "path": "/-/media/files/publications/wp/2017/wp17283.pdf.md",
        "mime": "text/markdown"
      },
      "binary": {
        "path": "/-/media/files/publications/wp/2017/wp17283.pdf",
        "mime": "application/pdf"
      }
    }
  ],
  "alternates": {
    "markdown": "/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/index.md",
    "json": "/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/index.json",
    "bundleManifest": "/en/publications/wp/issues/2017/12/21/exchange-rate-misalignment-and-growth-a-myth-45374/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-18T12:43:13.518Z"
}