Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/190220 
Year of Publication: 
2017
Series/Report no.: 
ADBI Working Paper No. 799
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
The real effective exchange rate (REER) is one of the most cited statistical constructs in open-economy macroeconomics. We show that the models used to compute these numbers are not rich enough to allow for the rising importance of global value chains. Moreover, because different sectors within a country participate in international production sharing in different ways, sector level variations are also important for determining competitiveness. Incorporating these features, we develop a framework to compute REER at the sector, country, and bilateral level and apply it on inter-country input-output tables to study the properties of the new measures of REER for 35 sectors in 40 countries.
JEL: 
F1
F3
F4
F6
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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