Exchange Rate Misalignment and Economic Growth: Recent Evidence in Malaysia

N.A.m Naseem and Hamizah M.s

MPRA Paper from University Library of Munich, Germany

Abstract: The present study aims at investigating the growth effects of real exchange rate misalignments in Malaysia over the period 1991:1-2009:4. The RER misalignment is built through the estimation of the NATREX equilibrium model. Using the Autoregressive Distributed Lag (ARDL) bounds testing approach to cointegration framework, the results indicate the presence of positive and significant relationship between the RER misalignment and economic growth. This finding obtained is consistent with the notion that the RER misalignment through the distortion in relative price has systematic influence on the pattern of economic development.

Keywords: Real Exchange Rate; Misalignment; NATREX Model; Output Growth; ARDL (search for similar items in EconPapers)
JEL-codes: C13 C32 F43 O41 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-sea
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Citations: View citations in EconPapers (5)

Published in Pertanikan Joournal of Social Sciences and Humanities special issue in economics.21(s)(2013): pp. 47-66

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