Capital Account Liberalization in Morocco: Is it Compatible with Fixed or Flexible Exchange Rate Regime?

Artikel

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.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Journal of Central Banking Theory and Practice ; ISSN: 2336-9205 ; Volume: 9 ; Year: 2020 ; Issue: 1 ; Pages: 185-218 ; Warsaw: De Gruyter Open

Classification and Topics

• Classification: Wirtschaft ; Foreign Exchange ; Current Account Adjustment; Short-term Capital Movements
• Subject: Capital account liberalization ; Exchange rate regime flexibilization ; compensation fund ; Real exchange rate ; and game theory.

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ezzahid, Elhadj ; Maouhoub, Brahim
• Event: Veröffentlichung
• (who): De Gruyter Open
• (where): Warsaw
• (when): 2020

Further information

• DOI: doi:10.2478/jcbtp-2020-0010
• Handle: http://hdl.handle.net/10419/217701
• Last update: 10.03.2025, 11:45 AM CET