The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and...

Conceptual ambiguities and statistical weaknesses hamper the assessment of external competitiveness. The term competitiveness, while applied extensively, is often imprecisely defined, which can result in analytical errors and mistaken policy advice. Furthermore, aggregate statistical measures of...

This paper examines the impact of trade costs on real exchange rate volatility. We incorporate a multi-country Ricardian model of trade, based on the work of Eaton and Kortum (2002), into a macroeconomic model to show how bilateral real exchange rate volatility depends on relative technological...

This paper examines the impact of trade costs on real exchange rate volatility. The channel is examined by constructing a two-country Ricardian model of trade, based on the work of Dornbusch, Fischer, and Samuelson (1977), which shows that higher trade costs result in a larger nontradable...

Of the new members entering the European Union (EU) in May 2004, several had achieved a decade of impressive export growth, expanding significantly their shares of world markets. The empirical analysis shows that over the period 1994–2004, quality and technology upgrading associated with the...

The dominant role of remittances in Comoros’s economy presents policymakers with important challenges and opportunities. Fiscal decentralization is a pillar of national reconciliation in Comoros. To make decentralization work better, more revenue and expenditure responsibilities could be...

This Selected Issues paper provides a preliminary view on Afghanistan’s external competitiveness through a review of some macroeconomic, microeconomic, and institutional indicators. It discusses the rebuilding of domestic revenue, and analyzes the macroeconomic impact of the drug economy and...

This paper attempts to assess the impact of the oil shock on South Asian economies, including Sri Lanka, as well as policy responses to deal with the shock, and the real income loss for low-income households if fuel subsidies were fully removed. The most important impact has been on the balance...

In recent years, the IMF has released a growing number of reports and other documents covering economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with government officials, is published at the option of the member country