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dc.titleExchange Rate Devaluation and Import Substitution in Latin America and the Caribbean
dc.contributor.authorMesquita Moreira, Mauricio
dc.contributor.authorPierola, Martha Denisse
dc.contributor.authorSánchez-Navarro, Dennis
dc.contributor.orgunitProductivity, Trade and Innovation Sector
dc.coverageLatin America
dc.coverageThe Caribbean
dc.date.available2017-04-25T00:00:00
dc.date.issue2017-04-25T00:00:00
dc.description.abstractThis 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.
dc.format.extent20
dc.identifier.doihttp://dx.doi.org/10.18235/0009362
dc.identifier.urlhttps://publications.iadb.org/publications/english/document/Exchange-Rate-Devaluation-and-Import-Substitution-in-Latin-America-and-the-Caribbean.pdf
dc.language.isoen
dc.mediumAdobe PDF
dc.publisherInter-American Development Bank
dc.subjectImport Substitution
dc.subjectManufacturing Import
dc.subjectExchange Rate
dc.subjectDevaluation of Currency
dc.subject.jelcodeC20 - Single Equation Models • Single Variables: General
dc.subject.jelcodeF14 - Empirical Studies of Trade
dc.subject.jelcodeF49 - Macroeconomic Aspects of International Trade and Finance: Other
dc.subject.keywordsExchange Rate Devaluation;Currency Devaluations;manufacturing imports
dc.typeTechnical Notes
idb.identifier.pubnumberTechnical Notes
idb.operationES-W1077
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