TY - JOUR AU - Zouhaier, Hadhek AU - Hniya, Sakli AU - Lafi, Mosbah PY - 2019/11/23 Y2 - 2024/03/29 TI - Equilibrium Real Exchange Rates and Capital Flows in Tunisia JF - International Journal of Economics and Financial Issues JA - IJEFI VL - 9 IS - 6 SE - Articles DO - UR - https://www.econjournals.com/index.php/ijefi/article/view/8795 SP - 232-240 AB - <p>The objective of this paper is to study the impact of the variability (volatility and misalignment) of the real exchange rate (RER) on trade flows over the period 1980-2014.In order to estimate the RER misalignment, we use the methodology of Edwards (1994) which defines the equilibrium RER as a pathway of fundamental variables to ensure internal and external macroeconomic balance. The relation between equilibrium RER and its determiners is obtained by applyingan Error-Correction Model (ECM).Results show that the volatility of the exchange rate causes a decline in exports and imports. The impact of the misalignment is significant only on imports.</p><p><strong>Keywords:</strong> Equilibrium real exchange rate, Misalignment, Cointegration, Export, Import, VECM.</p><p><strong>JEL Classifications:</strong> F14, F62</p><p>DOI: <a href="https://doi.org/10.32479/ijefi.8795">https://doi.org/10.32479/ijefi.8795</a></p> ER -