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Competitiveness in Bulgaria: An Assessment of the Real Effective Exchange Rate
Author:
Ms. Piritta Sorsa
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and
Dimitar Chobanov null

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Series:
IMF Working Papers
Volume/Issue:
Volume 2004: Issue 037
Language:
English
Publication Date:
01 Mar 2004
DOI:
https://doi.org/10.5089/9781451845600.001
ISBN:
9781451845600
ISSN:
1018-5941
Pages:
25
Keywords:
WP; exchange rate; RER.; saving; Real effective exchange rates; Fundamental determinants; NATREX; BEER; Bulgaria; Competitiveness; productivity differential; Bulgarian lev; productivity development; terms of trade index; overvalued exchange RER; productivity data; Real exchange rates; Productivity; Foreign direct investment; Terms of trade
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper presents an empirical analysis of the medium- and long-term determinants of the real (effective) exchange rate (RER) of the Bulgarian lev using elements from the natural real exchange rate (NATREX) and the behavioral equilibrium exchange rate (BEER) approaches. The results indicate that the RER is driven by fundamentals, including labor productivity, terms of trade, world real interest rates, gross savings, and foreign direct investment. The model also shows that there is no significant misalignment of the Bulgarian lev.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund