Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/217701
Authors: 
Ezzahid, Elhadj
Maouhoub, Brahim
Year of Publication: 
2020
Citation: 
[Journal:] Journal of Central Banking Theory and Practice [ISSN:] 2336-9205 [Volume:] 9 [Issue:] 1 [Publisher:] De Gruyter Open [Place:] Warsaw [Year:] 2020 [Pages:] 185-218
Publisher: 
De Gruyter Open, Warsaw
Abstract: 
This paper examines the opportunity of exchange rate regime flexibilization in Morocco under the policy of capital account liberalization. Basing on our findings in Ezzahid and Maouhoub (2014), we develop a new theoretical game model with four economic agents, namely: monetary authorities, government, foreign firms and domestic firms. We explore the optimal exchange rate regime for Morocco under new conditions such as the presence of a compensation fund effect, restrictions on capital outflows, etc. Starting with a first simulation based on current economic parameters, the results show that losses under a flexible exchange rate regime are lower than losses under a fixed exchange rate regime. Varying different parameters allow discovering the ‘appropriate level’ from which monetary authorities should move toward the flexible exchange rate.
Subjects: 
Capital account liberalization
Exchange rate regime flexibilization
compensation fund
Real exchange rate
and game theory.
JEL: 
F31
F32
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

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