Foreign Exchange Auction Markets in Sub-Saharan Africa
Title | Foreign Exchange Auction Markets in Sub-Saharan Africa PDF eBook |
Author | Janine Aron |
Publisher | World Bank Publications |
Pages | 44 |
Release | 1994 |
Genre | Comercio exterior - Africa (Sub-Saharan) |
ISBN |
A Typology of Foreign Exchange Auction Markets in Sub-Saharan Africa
Title | A Typology of Foreign Exchange Auction Markets in Sub-Saharan Africa PDF eBook |
Author | Janine Aron |
Publisher | World Bank Publications |
Pages | 40 |
Release | 1994 |
Genre | Comercio exterior - Africa (Sub-Saharan) |
ISBN |
A Typology of Foreign Exchange Auction Markets in Sub-Saharan Africa
Title | A Typology of Foreign Exchange Auction Markets in Sub-Saharan Africa PDF eBook |
Author | Ron Hood |
Publisher | |
Pages | 44 |
Release | 2017 |
Genre | |
ISBN |
In this analytical sequel to quot;A Typology of Foreign Exchange Auction Markets in sub-Saharan Africaquot; , the authors compare the micromanagement of different foreign exchange auctions in sub-Saharan Africa. Multi-unit auctions for foreign exchange were introduced in a number of countries in the 1980s and 1990s, in a transitional step toward a credible, sustainable, unified regime, such as efficient interbank market. But there is little understanding of how auction markets function in sub-Saharan Africa, and there has been virtually no research on the causes of frequent policy reversals or of auction failure. One possible cause of failure -- apart from thin markets, macroeconomic laxity, and vulnerability to terms-of-trade shocks and fluctuations in the disbursement of foreign aid -- is the inappropriate design and management of auctions. The authors estimate models for the microdeterminants of the auction rate, using weekly data on foreign exchange auctions for Ghana, Nigeria, Uganda, and Zambia. Among the policy lessons: 1) Nigeria and Zambia failed to unify and stabilize the exchange rate partly because there was no reserve price rule. When bidders learn such a rule, speculative bidding diminishes. 2) The management of a credible, sustainable reserve price policy requires an efficient secondary market. A simple underlying model, synthesized from the theoretical literature on auctions, specifies the auction rate as a function of fundamental variables and structural shift dummies. The repeated, sequential nature of these multi-unit auctions and the nonstationary nature of most of the auction variables are captured empirically by a cointegrated (error connection) framework. In addition to consistently estimating long-run and short-run parameters of auction fundamentals, the error correction model allows asymptotically efficient testing of three policy hypotheses deriving from auction theory: the competitiveness hypothesis, the effect of uncertainty on the auction-determined rate, and the revenue-equivalence hypothesis. In other words, they used these models to test the impact on the level of the auction rate of increased comptetition among bidders, of the effect of uncertainty (proxied by a volatile supply of foreign exchange), and of different pricing mechanisms.
Black Markets for Foreign Exchange, Real Exchange Rates, and Inflation
Title | Black Markets for Foreign Exchange, Real Exchange Rates, and Inflation PDF eBook |
Author | Brian Pinto |
Publisher | World Bank Publications |
Pages | 37 |
Release | 1988 |
Genre | Black market |
ISBN |
Inflation could rise permanently and substantially as a result of unifying official and black market exchange rates, even if real government spending remains constant.
The Reform of Mechanisms for Foreign Exchange Allocation
Title | The Reform of Mechanisms for Foreign Exchange Allocation PDF eBook |
Author | Eliana La Ferrara |
Publisher | World Bank Publications |
Pages | 64 |
Release | 1994 |
Genre | Foreign exchange |
ISBN |
The paper provides an analysis of the mechanisms for foreign exchange allocation used in trade policy reform and an assessment of their effectiveness. The case is strong for avoiding delay in moving to full currency convertibility in dismantling or modifying foreign exchange controls. Movement to a unified free market for exchange would be facilitated by changes in policies and in donor practice, so exchange can be channeled through private sellers.
The Liberalization of Foreign Exchange Markets and Economic Growth in Sub-Saharan Africa
Title | The Liberalization of Foreign Exchange Markets and Economic Growth in Sub-Saharan Africa PDF eBook |
Author | Nguyuru Haruna Ibrahim Lipumba |
Publisher | |
Pages | 76 |
Release | 1997 |
Genre | Business & Economics |
ISBN |
The Liberalization of Foreign Exchange Markets & Economic Growth in Sub-Saharan Africa offers an historical rationale for intervention in foreign exchange markets to promote long-term development. It also reviews exchange rate theory & balance of payments management & their application to African countries. The publication is part of the Research for Action series which discusses policy-oriented research on the main strategic issues of development & international cooperation, as well as on the interaction between domestic & global changes.
Exchange Rate Liberalization in Selected Sub-Saharan African Countries Successes, Failures, and Lessons
Title | Exchange Rate Liberalization in Selected Sub-Saharan African Countries Successes, Failures, and Lessons PDF eBook |
Author | Mr.Nils Øyvind Mæhle |
Publisher | International Monetary Fund |
Pages | 71 |
Release | 2013-01-31 |
Genre | Business & Economics |
ISBN | 1557756694 |
Many sub-Saharan African (SSA) countries liberalized their economies in the 1980s and early 1990s. This paper reviews the foreign exchange regime reforms in selected SSA, and their associated macroeconomic policies and economic performance during and after these reforms were undertaken. Before liberalization, most of the reviewed countries were characterized by extensive foreign exchange rationing, sizeable black market premiums, and declining per capita real income. Today, the countries that successfully reformed look markedly different. Rationing and parallel market spreads are a distant memory, and per capita income has increased sharply.