Publication: Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius
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Date
2009-09-01
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Published
2009-09-01
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Abstract
The authors estimate a VAR and compute generalized impulse response to analyze the joint dynamics of four key macroeconomic variables in the small open economy of Mauritius. Results suggest that nominal exchange rate and interest rate have limited ability to impact output growth over the medium-run. Large error bands hinder analysis of the inflation output trade-off, but evidence points to a weak relationship in the short run as well. These findings are used to shed some light into the policy response to the current worldwide economic slowdown affecting Mauritius.
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“Bastos, Fabiano; Angelo Divino, Jose. 2009. Exchange Rate and Output Fluctuations in the Small Open Economy of Mauritius. Policy Research working paper ; no. WPS 5065. © World Bank. http://hdl.handle.net/10986/4256 License: CC BY 3.0 IGO.”
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