EFFECTS OF EXCHANGE RATE VOLATILITY ON BRAZILIAN ECONOMIC GROWTH

Authors

  • Osmar José Bertholini Pianca Fucape Business School
  • Arilton Teixeira Fucape Business School
  • Poliano Bastos da Cruz Fucape Business School

DOI:

https://doi.org/10.19094/contextus.v14i1.773

Keywords:

Exchange volatility. Real exchange rate. Nominal exchange rate. GDP per capita. Economic growth.

Abstract

This study aims to capture accurately the effect of volatility of the exchange rate on growth. Following the literature, the analysis was performed in a developing country, intending to identify the direct effect of volatility on growth. Unlike the majority of prior empirical research, it was performed an analysis in a single country aiming to mitigate data comparability issues. We chose to Brazil because it is the country most notably among the BRICs, according to the OECD, and a research suggests that historical series correlated with growth have similar behavior to that observed in the world. Volatility was measured by eight distinct metrics and growth was measured by two metrics. The regressions were estimated by the Generalized Method of Moments, due to its better properties of small samples and to address endogeneity issues. The results of this study suggest that exchange rate volatility negatively affects growth.

Author Biographies

Osmar José Bertholini Pianca, Fucape Business School

Mestre em Administração

Arilton Teixeira, Fucape Business School

PhD. em Economia

Poliano Bastos da Cruz, Fucape Business School

Doutorado em Ciências Contábeis e Administração

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Published

2016-06-16

How to Cite

Pianca, O. J. B., Teixeira, A., & Cruz, P. B. da. (2016). EFFECTS OF EXCHANGE RATE VOLATILITY ON BRAZILIAN ECONOMIC GROWTH. Contextus - Contemporary Journal of Economics and Management, 14(1), 32–57. https://doi.org/10.19094/contextus.v14i1.773

Issue

Vol. 14 No. 1: jan/abr 2016

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Articles

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