Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries
This study makes an attempt to examine the long run relationship between the official and black market exchange rates using monthly data for a sample of 13 Middle East and Northern African (MENA) countries from 1970 to 1998. Using the Pool Mean Group framework, the article provides evidence on prop...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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EconJournals
2014-05-01
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| Series: | International Journal of Economics and Financial Issues |
| Online Access: | http://mail.econjournals.com/index.php/ijefi/article/view/833 |
| _version_ | 1797908467090980864 |
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| author | Ferit KULA Alper ASLAN Ilhan OZTURK |
| author_facet | Ferit KULA Alper ASLAN Ilhan OZTURK |
| author_sort | Ferit KULA |
| collection | DOAJ |
| description |
This study makes an attempt to examine the long run relationship between the official and black market exchange rates using monthly data for a sample of 13 Middle East and Northern African (MENA) countries from 1970 to 1998. Using the Pool Mean Group framework, the article provides evidence on proportional long run relationship between black and official market exchange rates in sample countries. The positive common long run official exchange rates (OEX) elasticity is statistically significant and slightly greater than one. The hypothesis of portfolio balance model is confirmed, implying that there exists a proportional long run equilibrium relationship between official exchange rates and black market exchange rates. However, the short run dynamics remain heterogeneous across countries.
Keywords: Black market exchange rate; official exchange rates; Panel data; Panel cointegration; MENA countries
JEL Classifications: C23; F31
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| first_indexed | 2024-04-10T10:54:14Z |
| format | Article |
| id | doaj.art-515b70eba79a49a5a8a150571ba1dae1 |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T10:54:14Z |
| publishDate | 2014-05-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-515b70eba79a49a5a8a150571ba1dae12023-02-15T16:20:03ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382014-05-0143Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA CountriesFerit KULA0Alper ASLAN1Ilhan OZTURKErciyes UniversityNevsehir Hacı Bektas Veli University, Nevsehir This study makes an attempt to examine the long run relationship between the official and black market exchange rates using monthly data for a sample of 13 Middle East and Northern African (MENA) countries from 1970 to 1998. Using the Pool Mean Group framework, the article provides evidence on proportional long run relationship between black and official market exchange rates in sample countries. The positive common long run official exchange rates (OEX) elasticity is statistically significant and slightly greater than one. The hypothesis of portfolio balance model is confirmed, implying that there exists a proportional long run equilibrium relationship between official exchange rates and black market exchange rates. However, the short run dynamics remain heterogeneous across countries. Keywords: Black market exchange rate; official exchange rates; Panel data; Panel cointegration; MENA countries JEL Classifications: C23; F31 http://mail.econjournals.com/index.php/ijefi/article/view/833 |
| spellingShingle | Ferit KULA Alper ASLAN Ilhan OZTURK Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries International Journal of Economics and Financial Issues |
| title | Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries |
| title_full | Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries |
| title_fullStr | Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries |
| title_full_unstemmed | Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries |
| title_short | Long Run Tendencies and Short Run Adjustments Between Official and Black Market Exchange Rates in MENA Countries |
| title_sort | long run tendencies and short run adjustments between official and black market exchange rates in mena countries |
| url | http://mail.econjournals.com/index.php/ijefi/article/view/833 |
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