TY  - GEN
AU  - Mesquita Moreira, Mauricio
AU  - Pierola, Martha Denisse
AU  - Sánchez-Navarro, Dennis
TI  - Exchange Rate Devaluation and Import Substitution in Latin America and the Caribbean
PY  - 2017
Y1  - 2017/04/25
DO  - 10.18235/0009362
AB  - This paper assesses the LAC's import substitution response to the recent wave of currency devaluations. For this purpose, this document uses both descriptive data and a simple econometric model to establish the short-term relationship between exchange rate movements and import penetration (total and within manufacturing sector) in the region, with a special focus on those countries that had experienced the largest depreciations. The results suggest that there is a significant relationship between depreciation and the decrease in import penetration, indicating that a 1% increase in the local currency depreciation reduces the IP by 0.41% to 0.69% and varies in those sectors with a stronger presence of domestic production.
UR  - https://doi.org/10.18235/0009362
ER  -