Nigerian Economic Society
Hi Guest,
Home | Paper Submission | Signup |
      
Providing intellectual leadership in economic management in Nigeria
AN EMPIRICAL ANALYSIS OF REAL EXCHANGE RATE MISALIGNMENT AND EXPORT DIVERSIFICATION IN NIGERIA

AN EMPIRICAL ANALYSIS OF REAL EXCHANGE RATE MISALIGNMENT AND EXPORT DIVERSIFICATION IN NIGERIA

 

Abstract: This paper empirically explores the relationship between real exchange rate misalignment and export diversification in Nigeria over the period 1995q1 to 2014q4. The link between exchange rate misalignment and diversification is highly debated and the empirical evidence highly debated. Based on this lack of consensus, this paper used two different measures of real exchange rate misalignment (fundamental equilibrium exchange rate approach and behavioural equilibrium exchange rate approach) to substantiate the robustness of our conclusion. This paper seeks to contribute to the debate by using the Toda-Yomamato causality and bound testing approach to cointegration. The result of the cointegration test shows evidence of long-run relationship between our variables of interest. The findings show that export diversification Granger-cause exchange rate misalignment, this suggests that export diversification effort could reduce unwarranted movement in real exchange rate, thereby reducing exchange rate misalignment. The result also suggests that there is causality running from misalignment (feer) to export diversification, which provides ample evidence that deliberate effort to alter the equilibrium exchange rate (misalignment) could yield positive result in the export diversification effort. The policy implication of the result is that export diversification is a viable option for Nigeria to reduce unwarranted movement in exchange rate.
JEL Codes: O24, F10, 014

 

 

 

Login

Forget password? | Signup for Free!
Note: You must signup your email and create a password before you can register as an NES member
 

Latest News

Winners of The Nigerian Economic Society PhD Thesis Prize Award in Economics for 2018

The Executive Council of the NES is pleased to announce the Winners of The Nigerian Economic Society...read more


Communique of the 59th Annual Conference of the Nigerian Economic Society, held at the NICON Luxury Hotel, Abuja from September 25-27, 2018

Theme: Optimizing Value Chain in the Agricultural Sector in Nigeria The Nigerian Economic Society i...read more


2018 Nigerian Economic Society Annual Public Lecture Announcement

The Executive Council of NES has the pleasure to announce it's 2018 Annual Public Lecture with the t...read more


E-Mail Subscription

VoguePayVisaMasterCard