Download or read book Real Exchange Rate Behavior and Economic Growth written by Mr.Ghiath Shabsigh and published by International Monetary Fund. This book was released on 1999-03-01 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the effect of the real exchange rate misalignment (RERMIS) on the collective economic growth of Egypt, Jordan, Morocco, and Tunisia. The paper constructs three measures of exchange rate misalignment based on purchasing power parity; a black market exchange rate; and a structured model. The empirical investigation confirmed the adverse effect of RERMIS on growth, using all measures of RERMIS, as predicted by endogenous growth models. The results also highlighted the role of other factors; specifically, capital growth and population have the theoretical signs predicted by the Solow growth model and are statistically significant.