Parallel exchange rates in developing countries
4 Jun 2009 Due to restrictive foreign exchange policy and active parallel markets for foreign exchange in some developing countries, it is often believed that the real official exchange rate is undervalued (overvaluing the domestic 8 Jan 2020 the Moroccan Central Bank. Key words: Monetary Policy, Exchange Rate Regime, Reforms, Developing countries, floating, Morocco 13 Unofficial: the parallel exchange rate or the “black market. 14 The multiple exchange Factors peculiar to such countries which are believed to potently drive their nominal ex- change rates are incorporated into the resulting model. In particular, the weather, parallel market exchange rate and its associated premium as well as B.B. Aghevli, S.Mohsin Khan, Peter J. MontielExchange rate policy in developing countries: Some analytical issues Mukwanason HyuhaReflection on Forex Bureau/Parallel and official foreign exchange rates and inflation in Uganda. in the case of most developing countries, the black market for foreign currencies, though illegal, appears to be surprisingly well tolerated by the authorities.10. Although the exchange dealers (except in the tribal areas) do not advertise their 29 May 2019 The floating rate is often market-determined in parallel to the official exchange rate. the development of multiple exchange rates and a currency black market that have contributed to the country's long period of instability. Pervasive controls, in turn, typically lead to either a large parallel ("black") market for foreign exchange or, in other For developing countries that do not have extensive access to capital markets, we find that (relatively) fixed exchange rate
Parallel Exchange Rates In Developing Countries Abstract Parallel foreign exchange systems are those in which a market-determined exchange rate, typically applying to financial transactions but often to a portion of trade transactions as well, coexists with one or more pegged exchange rates.
Dual exchange rates and black markets for foreign exchange are common in developing countries, and a body of evidence is beginning to emerge on the effects that such parallel foreign exchange systems have on macroeconomic performance. This article presents a simple typology of parallel systems, discusses their emergence, and looks at why countries prefer these arrangements to the main Parallel exchange rates in developing countries (Английский) Аннотация Dual exchange rates and black markets for foreign exchange are common in developing countries, and a body of evidence is beginning to emerge on the effects that such parallel foreign exchange systems have on macroeconomic performance. Parallel exchange rates, being market determined, have tended to show large fluctuations, reflecting short-run changes in the underlying supply and demand curves. Table 1 presents estimates of the degree of variability of official and parallel exchange rates in a group of 11 developing countries over the period 1974-86. The table shows that parallel market rates have in general exhibited a substantially higher degree of volatility than official rates. The paper develops and tests a model of a developing economy that incorporates trade and capital restrictions, illegal transactions, a parallel foreign exchange market, currency substitution features, and forward-looking rational expectations. Temporary expansionary demand policies are associated with an increase in output and prices, a fall in the stock of net foreign assets, and a OUTPUT, INFLATION, AND EXCHANGE RATE IN DEVELOPING COUNTRIES: AN APPLICATION TO NIGERIA A. F. ODUSOLA A. E. AKINLO I. INTRODUCTION U NDERSTANDING the sources of fluctuations in output and inflation is an im portant challenge to empirical macroeconomists. It is an issue taken up in a large number of recent studies in the developed nations, Latin America,
- Samuel M. Wangwe, Professor of Economics, University of Dar es Salaam and Executive Director, Economic and Social Research Foundation, Dar es Salaam, Tanzania This book examines extensive empirical evidence on the macroeconomic implications of parallel exchange rates in developing countries.
Pervasive controls, in turn, typically lead to either a large parallel ("black") market for foreign exchange or, in other For developing countries that do not have extensive access to capital markets, we find that (relatively) fixed exchange rate However, Nigeria is a developing country with a flexible exchange rate regime and the use of foreign currency is under control of the monetary authorities. Hence, like other developing countries, Nigeria also has the parallel exchange market
- Samuel M. Wangwe, Professor of Economics, University of Dar es Salaam and Executive Director, Economic and Social Research Foundation, Dar es Salaam, Tanzania This book examines extensive empirical evidence on the macroeconomic implications of parallel exchange rates in developing countries.
Factors peculiar to such countries which are believed to potently drive their nominal ex- change rates are incorporated into the resulting model. In particular, the weather, parallel market exchange rate and its associated premium as well as B.B. Aghevli, S.Mohsin Khan, Peter J. MontielExchange rate policy in developing countries: Some analytical issues Mukwanason HyuhaReflection on Forex Bureau/Parallel and official foreign exchange rates and inflation in Uganda. in the case of most developing countries, the black market for foreign currencies, though illegal, appears to be surprisingly well tolerated by the authorities.10. Although the exchange dealers (except in the tribal areas) do not advertise their 29 May 2019 The floating rate is often market-determined in parallel to the official exchange rate. the development of multiple exchange rates and a currency black market that have contributed to the country's long period of instability.
Parallel Exchange Rates In Developing Countries Abstract Parallel foreign exchange systems are those in which a market-determined exchange rate, typically applying to financial transactions but often to a portion of trade transactions as well, coexists with one or more pegged exchange rates.
A unique feature of the exchange rate regimes in the developing countries is the co- existence of a parallel or black market for foreign exchange along with the official market. In the literature on black market exchange rate, however, there are
The parallel foreign exchange market arises as a direct consequence of the adoption of exchange rate controls in many developing economies facing substantial macroeconomic imbalances. Parallel exchange rates in developing countries (Inglês) Resumo. Dual exchange rates and black markets for foreign exchange are common in developing countries, and a body of evidence is beginning to emerge on the effects that such parallel foreign exchange systems have on macroeconomic performance. Dual exchange rates and black markets for foreign exchange are common in developing countries, and a body of evidence is beginning to emerge on the effects that such parallel foreign exchange systems have on macroeconomic performance. This article presents a simple typology of parallel systems, discusses their emergence, and looks at why countries prefer these arrangements to the main - Samuel M. Wangwe, Professor of Economics, University of Dar es Salaam and Executive Director, Economic and Social Research Foundation, Dar es Salaam, Tanzania This book examines extensive empirical evidence on the macroeconomic implications of parallel exchange rates in developing countries. Parallel Exchange Rates In Developing Countries Abstract Parallel foreign exchange systems are those in which a market-determined exchange rate, typically applying to financial transactions but often to a portion of trade transactions as well, coexists with one or more pegged exchange rates. - Samuel M. Wangwe, Professor of Economics, University of Dar es Salaam and Executive Director, Economic and Social Research Foundation, Dar es Salaam, Tanzania This book examines extensive empirical evidence on the macroeconomic implications of parallel exchange rates in developing countries.