The Impact of Real Effective Exchange Rate on Economic Growth: Algeria Case Study

Sumaya Zirar, Mohammed Moussaoui

Abstract


The purpose of this study is to determine the effect of real effective exchange rate on the economic growth in Algeria from (1980-2013), by using the cointegration test and the Fully-Modified OLS method, the study found a long run relationship between economic growth and variables: money supply, labor productivity, government expenditure, and real effective exchange rate, the estimation shows also that the real effective exchange rate has a negative effect on the economic growth


Keywords


Real effective exchange rate, Economic growth, Fully-Modified OLS, M2

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