Khalid Sekkat

Exchange-rate management and manufactured exports in Sub-Saharan Africa

This paper presents an overview of the evolution of exchange-rate regimes in Africa and then attempts to assess empirically the impact of exchange-rate policy on manufactured export performance on a panel of major Sub-Saharan Africa countries over the 1970-92 period. We examine the impact of three exchange-rate policy indicators: real effective exchangerate changes, real exchange-rate volatility, and (model-based measures of) real exchange-rate misalignment. Export supply functions are estimated for three manufacturing industries (textile, chemicals, and metals) and two exchange-rate regimes: a fixed rates regime including six CFA Franc countries, and a more flexible regime represented by five non-CFA countries. Our findings show that exchange-rate management matters for export performance. This is evidenced both by the significant impact of changes in the real effective exchange rate and by the negative influence exerted independently by real exchange-rate misalignment. On the ... L’evolution des regimes de change en Afrique entre 1970 et 1992 est examinee dans ce document. Les effets de la politique de change sur les exportations de produits manufactures de l’Afrique sub-saharienne sont egalement examines de maniere empirique. Trois indicateurs de la politique de change sont plus particulierement etudies: les variations du taux de change reel effectif, la volatilite du taux de change reel et son defaut d’alignement (mesure a partir d’un modele). Des fonctions d’exportation ont ete estimees pour trois branches de l’industrie manufacturiere (textile, chimie, metallurgie), ainsi que deux regimes de change: un regime de taux de change fixes, represente par six pays de la zone CFA, et un second, plus flexible, represente par cinq pays n’appartenant pas a cette zone. Il en ressort que la politique de change influe largement sur les performances a l’exportation du fait des consequences importantes des variations du taux de change reel effectif et de l’incidence ...

INSTITUTIONAL QUALITY AND TRADE: WHICH INSTITUTIONS? WHICH TRADE?

Using a panel of countries over 1920-2000, this paper examines the extent to which different dimensions of the institutional framework affect exports of total, manufactured, and non-manufactured goods. It is observed that exports of manufactured goods are positively affected by the control of corruption, the rule of law, government effectiveness, and the lack of political violence. This result does not hold for non-manufactured and total exports. Instrumental variable regressions finally confirm that the control of corruption, but not the other dimensions of governance, robustly cause manufactured exports.

Managerial Career Concerns, Privatization and Restructuring in Transition Economies

We set up a dynamic adverse selection model to explain how career concerns may induce managers in state-owned enterprises (SOEs) to restructure their firms. It is shown how government monopsony power over managers led to the ratchet effect under the socialist economy, even under reforms coming short of privatization. The introduction of a managerial labour market, through privatization, introduces competition for managers and eliminates the ratchet effect, thereby inducing managers to restructure. Prospects of privatization also provide incentives to restructure even when managerial skills are asset-specific, provided insider control is strong enough to give managers enough rents from privatization. The model is consistent with the empirical evidence on restructuring of SOEs in transition economies. (This abstract was borrowed from another version of this item.) (This abstract was borrowed from another version of this item.) (This abstract was borrowed from another version of this item.) (This abstract was borrowed from another version of this item.)

The European Single Currency and MENA's Exports to Europe

The paper investigates future exchange rate policy of the Middle East and North African (MENA) countries vis-ý-vis the euro aimed at fostering their manufactured exports towards Euroland. The exchange rate policy is captured through three different indicators: the real effective exchange rate changes, volatility, and misalignment. The investigation is conducted for 11 sectors over the period 1970-1997. The sample includes four North African countries (Algeria, Morocco, Tunisia, Egypt) and Turkey. The results show that exchange rate management plays a crucial role in providing incentives for manufactured exports toward Euroland. The food sector is weakly responsive to real exchange rate changes while the textile sector is highly responsive. Four growing sectors (electronic, electrical, mechanical, and vehicles) were also found to be highly sensitive to exchange rate changes. The results suggest that policymakers should be more concerned with misalignment than with volatility. Copyright Blackwell Publishing Ltd 2003.

Skilled migration and the transfer of institutional norms

AbstractWe examine two impacts of international emigration on the evolution of the institutions in the origin countries. The first impact concerns the influence of emigration per se (i.e. people who left the country can voice more or less from abroad). The second impact relates to the transfer of the norms of the host country to the home country. The existence of both impacts is confirmed using different indicators of institutional quality. The effects appear stronger when skilled emigration is considered. The main conclusions are robust to alternative econometric methods and to the use of subsamples involving developing countries only.JEL codesF22, J24, J61, J64.

Testing for spurious causality in exchange rates

Abstract In this paper, we distinguish between the ‘true’ and ‘spurious’ components of observed causalities. ‘True’ refers to the underlying continuous-time model while ‘spurious’ designates a term arising from the discretization of the model. We provide a test for making the difference between these two components, and thus testing for spurious causality. An application to exchange rates emphasizes the importance of the phenomenon. Indeed, it puts forward that the causalities observed at finite frequencies from the German mark to the Swiss franc are actually spurious.

European integration and the functioning of product markets

The book reveals that European product market integration has a significant impact on the conditions of competition, the strategies of companies and the structure of industry. It adds a quarter of a percentage to annual GDP growth rates and has not led to an increased exposure of the EU to asymmetric shocks. However, the book argues that further improvements in the functioning of European product markets are needed in order to improve the EU’s growth performance over the next decade. Invaluably, the book provides not only current information about Europe’s achievements in economic integration but also methodology to assess the outcome of economic integration in other regions of the World, such as NAFTA, MERCOSUR and ASEAN.

Exchange rate regimes and trade prices Does the EMS matter

This paper investigates the role of the exchange rate regime in the process of trade adjustment, by examining the relationship between trade prices and exchange rate regimes. The theoretical framework is a dynamic one a la Froot-Klemperer (1989). The empirical investigation takes advantage of the simultaneous occurrence, since 1979, of relatively stable exchange rates inside the ERM and instable rates outside to engage in a controlled experiment on the impact of the exchange rate regime on trade prices. The results suggest that a system of pegged rates like the EMS, although helpful, is not necessary to achieve a smooth process of trade adjustment. It appears that the absence of misalignment rather than the type of exchange rate regime is the crucial factor for fulfilling such an objective.

Efficiency Gains from Liberalizing Labor Mobility

This paper quantifies the effect of a complete liberalization of international migration on the world GDP and its distribution across regions. We build a general equilibrium model endogenizing bilateral migration and wage disparities between and within countries. A dual strategy is developed to identify total migration costs and their legal component. Contrary to existing studies, we obtain limited efficiency gains. Accounting for incompressible moving costs strongly reduces the benefits from liberalization. When we account for endogenous productivity, congestion, heterogeneous education quality, imperfect substitution between migrants and natives, and network effects, efficiency gains reach about 4 percent of the world GDP.

Industrial policy in Europe, Japan and the USA : amounts, mechanisms and effectiveness

Introduction PART I: THEORY AND EMPIRICAL EVIDENCE Public Support to Business: An Overview Cases for Public Support: Market Failures Argument Against Public Support: Government Failures Instruments of Support: Subsidies and Public Procurement Effectiveness of Public Support PART II: QUANTITATIVE ASSESSMENT Subsidies and State Aid Public Procurement PART III: COUNTRY STUDIES Public Support in Germany Public Support in France Public Support in the United Kingdom Public Support in the United States Public Support in Japan Conclusion List of Acronyms References