Exchange Rate Assessment in a Resource - Dependent Economy : The Case of Botswana.

The paper combines various methodologies to assessing the level of the exchange rate in Botswana, explicitly taking into account the implications of its dependency on diamond exports. Real exchange rate estimation indicates that, after a period of overvaluation, Botswana's real effective exchan...

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Bibliographic Details
Main Author: Deléchat, Corinne.
Other Authors: Gaertner, Matthew.
Format: eBook
Published: Washington : International Monetary Fund, 2008.
Series:IMF Working Papers
Online Access:Click to View
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Table of Contents:
  • Intro
  • Contents
  • I. Introduction
  • II. External Sector Developments and Key Vulnerabilities
  • A. Balance of payments
  • B. Evolution of REER indices
  • III. Equilibrium Exchange Rate Estimation
  • A. Behavioral equilibrium exchange rate approach
  • B. Estimation results
  • IV. External Sustainability Approach
  • V. Export Performance and Nonprice Competitiveness Indicators
  • A. External sector outcomes
  • B. Nonprice indicators of competitiveness
  • VI. Summary and Conclusions
  • References
  • Appendix
  • Tables
  • 1. Assumptions
  • 2. Comparative Costs of Infrastructure Services in the Late 1990s
  • 3. Comparativeness Rankings
  • Figures
  • 1. Balance of Payments Trends
  • 2. Real Effective Exchange Rate Indices
  • 3. Determinants of the Real Effective Exchange Rate
  • 4. Equilibrium Real Exchange Rate Estimation
  • 5. External Sustainability Assessment
  • 6. Export Performance Indicators
  • 7. Governance Indicators
  • Appendix Tables
  • 1. Unit Root Tests
  • 2. Test for Model Reduction
  • 3. Cointegration Tests: Trace Test and Maximum Eigenvalue
  • 4. Results of Cointegration Estimation
  • 5. Residuals Tests
  • Appendix Figures
  • 1. Breakdownpoint Chow Tests
  • 2. Equilibrium REER Estimation: Cointegration Residuals.