Exchange rate undervaluation and manufactured exports: A deliberate strategy?

Nouira, Ridha, Plane, Patrick, and Sekkat, Khalid-Exchange rate undervaluation and manufactured exports: A deliberate strategy? Recent literature suggests that a proactive exchange rate policy in accordance with price incentives (i.e. undervaluation) can foster manufactured exports and growth. This paper is built on these recent developments and investigates, using a sample of 52 developing countries, whether such a proactive exchange rate policy is adopted. The results show that during the period 1991-2005 a number of countries has used undervaluation to foster the price competitiveness of manufactured exports. Journal of Comparative Economics 39 (4) (2011) 584-601. University de Sfax, Tunisia; Clermont Universite, Universite d'Auvergne, Centre d'Etudes et de Recherches sur le Developpement International (CERDI) - CNRS, France; University of Brussels, Belgium. (C) 2011 Association for Comparative Economic Studies Published by Elsevier Inc. All rights reserved.