INVESTIGADORES
MEDICI florencia
artículos
Título:
Questioning the effect of the real exchange rate on growth: New evidence from Mexico
Autor/es:
MEDICI, FLORENCIA; MARIO, AGUST├ŹN; FIORITO, ALEJANDRO
Revista:
Review of Keynesian Economics
Editorial:
Edward Elgar Publishing Ltd.
Referencias:
Año: 2021 vol. 9 p. 253 - 269
ISSN:
2049-5323
Resumen:
This study provides new evidence showing that the real exchange rate (RER) does not play an important role in the growth of Mexican GDP. Economic growth is not an automatically predetermined result of relative price correction, and it is important to consider distinctive aspects of national institutional arrangements (fiscal and monetary, for example) for understanding theoretical causality of demand. The empirical results show public expenditure is an overlooked variable in regressions where the exchange rate affects product growth. After incorporating public expenditure, the RER impact on growth becomes insignificant. For its part, public expenditure has a positive and significant effect on GDP in the long term. The RER does not lead to greater GDP since exports are not stimulated through price.