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Alternative Measures of the Swedish Real Effective Exchange Rate

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  • Nilsson, Kristian

    (National Institute of Economic Research)

Abstract

This study presents alternative measures of the Swedish real effective exchange rate (REER), based on three alternative weighting schemes and three alternative price indices. Pros and cons of alternative measures are discussed in the context of the REER as an indicator of competitiveness. Bivariate VAR-models are estimated in an effort to conclude whether or not the alternative REER measures contain leading information on real GDP, real investments and real net exports. The results may be interpreted as empirical support for the supposition that REERs based on export prices reflect competitiveness primarily for internationally trade goods and services, while REERs based on consumer prices serve as a broader indicator of competitiveness.

Suggested Citation

  • Nilsson, Kristian, 1999. "Alternative Measures of the Swedish Real Effective Exchange Rate," Working Papers 68, National Institute of Economic Research.
    • Handle: RePEc:hhs:nierwp:0068
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    References listed on IDEAS

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    1. M. Nakorji & E. Udeaja & F. Ismail & S. Zimboh & T. Obiezue & O. Asuzu, 2019. "Computation of the Real Effective Exchange Rate (REER) using the Bank for International Settlement (BIS) Methodology," Economic and Financial Review, Central Bank of Nigeria, vol. 57(3), August.
    2. Marit Hinnosaar & Hannes Kaadu & Lenno Uuskula, 2005. "Estimating the equilibrium exchange rate of the Estonian kroon," Bank of Estonia Working Papers 2005-2, Bank of Estonia, revised 10 Oct 2005.
    3. Bergvall, Anders, 2002. "The Stabilizing Properties of Floating Exchange Rates: Some International Evidence," Working Paper Series 2002:14, Uppsala University, Department of Economics.
    4. Li, Ying & Rowe, Francis, 2007. "Aid inflows and the real effective exchange rate in Tanzania," Policy Research Working Paper Series 4456, The World Bank.
    5. Elena Pelinescu & Marioara Iordan & Mihaela-Nona Chilian, 2012. "Competitiveness Of The Romanian Economy From European Perspective," New Trends in Modelling and Economic Forecast (MEF 2011), ROMANIAN ACADEMY – INSTITUTE FOR ECONOMIC FORECASTING;"Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences, vol. 1(1), pages 86-104, January.
    6. Pelinescu, Elena & Caraiani, Petre, 2006. "Estimating the Real Effective Exchange Rate (REER) by Using the Unit Labor Cost (ULC) in Romania," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 3(4), pages 5-22, December.

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