Demand for Value Added and Value-Added Exchange Rates [electronic resource] Bems, Rudolfs..
- Washington, D.C. : International Monetary Fund, 2015.
- IMF eLibrary
IMF Working Papers: Working Paper No. 15/199
- Government document
1 online resource (70 p.)
- Local subjects:
Global supply chains.
Real effective exchange rate.
Real effective exchange rates.
- We examine the role of cross-border input linkages in governing how international relative price changes influence demand for domestic value added. We define a novel value-added real effective exchange rate (REER), which aggregates bilateral value-added price changes, and link this REER to demand for value added. Input linkages enable countries to gain competitiveness following depreciations by supply chain partners, and hence counterbalance beggar-thy-neighbor effects. Cross-country differences in input linkages also imply that the elasticity of demand for value added is country specific. Using global input-output data, we demonstrate these conceptual insights are quantitatively important and compute historical value-added REERs.
- Description based on print version record.
- Bems, Rudolfs.
Johnson, Robert C.
- Other format:
- Print Version:
- Publisher Number:
- Access Restriction:
- Restricted for use by site license.
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