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  • Vox, CEPR Policy Portal

You Can't Always Get What You Want: The Real Exchange Rate and Manufacturing Performance in a World of Global Value Chains

By: Laura Alfaro, Alejandro Cuñat, Harald Fadinger and Yanping Liu
  • Format:Electronic
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Abstract

Real exchange rate devaluations are typically seen as a viable development strategy, but the effectiveness of the approach may vary over time and across countries. This column explores this issue by focusing on the microeconomics of firm-level responses to exchange rate fluctuations. Results show varying patterns of responses to fluctuations by region and by import/export orientation. These results highlight the crucial role of a firm’s integration in global value chains.

Keywords

Manufacturing Performance; Real Exchange Rate; Global Value Chains; Economics; Production; Performance

Citation

Alfaro, Laura, Alejandro Cuñat, Harald Fadinger, and Yanping Liu. "You Can't Always Get What You Want: The Real Exchange Rate and Manufacturing Performance in a World of Global Value Chains." Vox, CEPR Policy Portal (October 2, 2018).
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About The Author

Laura Alfaro

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More from the Authors
  • Trade and Industrial Policy in Supply Chains: Directed Technological Change in Rare Earths By: Laura Alfaro, Harald Fadinger, Jay Schymik and Gede Virananda
  • Trade Within Multinational Boundaries By: Laura Alfaro, Paola Conconi, Fariha Kamal and Zachary Kroff
  • Bank Financing of Global Supply Chains By: Laura Alfaro, Mariya Brussevich, Camelia Minoiu and Andrea Presbitero
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