A conceptual framework is proposed as an input to the design of growth-oriented adjustment programs. The two building blocks of the model are the well-known monetary approach to the balance of payments and a variant of the open-economy neoclassical growth model. The integrated model combines...

Although the nominal exchange rate is often used as a policy instrument in small, primary-commodity-exporting countries, the real exchange rate is an endogenous variable that responds to both exogenous and policyinduced shocks. This paper examines the dynamic effects on the real exchange rate of...