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An Assessment of Real Exchange Rate Movements in the Transition Economies of Central and Eastern Europe

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  • Panagiotis Liargovas

Abstract

One common development in the transition economies of Central and Eastern Europe is the real appreciation of their exchange rates at the beginning of the 1990s. This article makes an assessment of the real exchange rate movements in transition economies at the beginning of the 1990s. After reviewing the main theories which explain real exchange rate patterns, it investigates the importance and the sources of these movements. Are these movements an equilibrium change resulting from an initial policy measure (e.g. devaluation), or they are due to divergent cost and price developments, or to different productivity trends or to increased capital inflows?

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  • Panagiotis Liargovas, 1999. "An Assessment of Real Exchange Rate Movements in the Transition Economies of Central and Eastern Europe," Post-Communist Economies, Taylor & Francis Journals, vol. 11(3), pages 299-318.
    • Handle: RePEc:taf:pocoec:v:11:y:1999:i:3:p:299-318
    DOI: 10.1080/14631379995904
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    1. repec:zbw:bofitp:2001_007 is not listed on IDEAS
    2. De Broeck, Mark & Sloek, Torsten, 2001. "Interpreting real exchange rate movements in transition countries," BOFIT Discussion Papers 7/2001, Bank of Finland Institute for Emerging Economies (BOFIT).
    3. International Monetary Fund, 2001. "Interpreting Real Exchange Rate Movements in Transition Countries," IMF Working Papers 2001/056, International Monetary Fund.
    4. Francois Gurtner, 2002. "Currency Board and Debt Trap: Evidence from Argentina and Relevance for Estonia," CERT Discussion Papers 0204, Centre for Economic Reform and Transformation, Heriot Watt University.
    5. David Barlow, 2004. "Purchasing Power Parity in Three Transition Economies," Economic Change and Restructuring, Springer, vol. 36(3), pages 201-221, September.
    6. Jozef M. Van Brabant, 2001. "Exchange-rate policy in eastern Europe and EU integration," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 54(218), pages 219-248.
    7. David Barlow, 2003. "Purchasing Power Parity in Three Transition Economies," Economic Change and Restructuring, Springer, vol. 36(3), pages 201-221, September.
    8. Kemme, David M. & Roy, Saktinil, 2006. "Real exchange rate misalignment: Prelude to crisis?," Economic Systems, Elsevier, vol. 30(3), pages 207-230, October.
    9. De Broeck, Mark & Sloek, Torsten, 2001. "Interpreting real exchange rate movements in transition countries," BOFIT Discussion Papers 7/2001, Bank of Finland, Institute for Economies in Transition.
    10. Hasanov, Fakhri & Huseynov, Fariz, 2009. "Real Exchange Rate Misalignment in Azerbaijan," MPRA Paper 29561, University Library of Munich, Germany.
    11. David Barlow & Roxana Radulescu, 2002. "Purchasing Power Parity in the Transition: The Case of the Romanian Leu Against the Dollar," Post-Communist Economies, Taylor & Francis Journals, vol. 14(1), pages 123-135.
    12. Waltraud Schelkle, 2003. "A Mixed Blessing: Monetary Enlargement within the Maastricht Policy Framework," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 72(4), pages 624-635.
    13. Jozef M. Van Brabant, 2001. "Exchange-rate policy in eastern Europe and EU integration," Banca Nazionale del Lavoro Quarterly Review, Banca Nazionale del Lavoro, vol. 54(218), pages 219-248.

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