Browsing by Author "Sandoval-Alvarado, Catalina"
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- Análisis histórico del tipo de cambio real en Costa RicaThe Real Exchange Rate (RER) is a relative price that determines the allocation of resources in an economy, therefore it has an impact on economic activity and, in addition, reflects the conditions that affect competitiveness in international trade. Its analysis and interpretation must be carried out in a complementary way with internal and external macroeconomic variables. In this paper, the RER in Costa Rica is analyzed from a historical perspective for the period 1957-2020, together with the trajectory of its long-term macroeconomic fundamentals and the exchange rate regime in force at each moment. There is also included an estimation of the equilibrium real exchange rate (ERER) using the approach called Behavioral Equilibrium Exchange Rate (BEER). It is documented that the macroeconomic fundamentals of the ERER have varied substantially in ways that affected the RER in different directions, and that the latter has mostly remained on a path consistent with the equilibrium dictated by its macroeconomic fundamentals.
- Una aproximación del tipo de cambio real para Costa Rica, enfoque BEER 2007-2022This paper describes the methodology and results of estimating the equilibrium real exchange rate (ERER) using the reduced-form approach known as the Behavioral Equilibrium Exchange Rate (BEER). The real exchange rate (RER) equation is estimated with quarterly data in the period between I-2007 and IV-2022, which coincides with the adoption of exchange rate flexibility regimes in Costa Rica. The results indicate that the path of the ERER is explained by the evolution of its fundamentals: labor productivity, government expenditure, international investment position, terms of trade and the difference among local and external interest rates. Improvements in labor productivity, increases in Government spending and increases in the spread of local and external interest rates are correlated with downward movements in the equilibrium path of the RER (real appreciations). On the other hand, the more negative result in the international investment position and a fall in terms of trade explains movements towards real depreciations. During the period of analysis, there is no evidence of RER deviations from its equilibrium level beyond the coherence zone determined. Therefore, the variations on the ERER trajectory are consistent with the behavior of its fundamentals.
- Indicadores de holgura en el mercado laboral costarricenseThis article provides a set of labor market slackness indicators for Costa Rica. First, we provide an estimation of the NAIRU rate using a linear state-space model featuring a Phillips curve to capture the underlining relationship between inflation and unemployment. Next, we compute the natural rate of unemployment under the premise that the flow origins of the unemployment rate determine unemployment fluctuations and trends. Lastly, we compute an efficient unemployment rate, an unemployment level that maximizes welfare and that considers the unemployment-vacancy trade-off governed by the Beveridge curve. The three estimators coincide in showing positive employment gaps during the last decade, which translates to excess capacity at the aggregate level. Although the pandemic exacerbated the gaps, the results point that the unemployment rate
- Interdependence between Fiscal and Monetary Policy: the case for Costa RicaEste estudio analiza si la política fiscal afectó la política monetaria en Costa Rica en el periodo 1991-2019, bajo tres enfoques metodológicos. Primero, se realiza una prueba de dominancia fiscal que evalúa la relación entre el balance primario del Gobierno y los pasivos públicos mediante un modelo de vectores autorregresivos (VAR). Los resultados arrojan resultados mixtos que no permiten identificar claramente un régimen de dominancia fiscal. Segundo, se estima la función de reacción del Banco Central para analizar si el déficit primario y la deuda pública tienen un efecto significativo sobre la tasa de política monetaria. Esto se lleva a cabo mediante un modelo de rezagos distribuidos autorregresivos (ARDL) con corrección de errores que permite estimar la relación de largo plazo. Se encontró evidencia de que la tasa de política monetaria reacciona positivamente al crecimiento de la deuda en el largo plazo, pero no al déficit fiscal. Esto sugiere que el Banco Central no considera las acciones de la política fiscal en su función de reacción. Por último, utilizando también un modelo ARDL con corrección de errores, se evalúa la relación de largo plazo entre inflación y déficit fiscal. Hay evidencia de que en el largo plazo el déficit fiscal influye sobre el resultado inflacionario, principalmente en los 90s. En conjunto, estos resultados sugieren que la política fiscal no afectó la política monetaria, excepto en la década de 90s.
- Relación entre los precios de las materias primas y la inflación en Costa RicaThis paper analyzes empirically the relationship between the variations of international commodity prices and inflation in Costa Rica in the period from January 2000 to December 2021. The pass-through of the commodity prices to the consumer prices is analyzed through the supply chain using the consumer price index (IPC), the manufacture producer price index (IPP-MAN) and the commodity price index (IP-MPi). A recursive model of Autoregressive Vectors allows us to represent the relationship between these variables. The results indicate that the pass-through from commodity prices to inflation is small. For example, an increase of 10 percentage points in the variation of the prices of commodities in the international market will increase inflation on 0.27 p.p. after six months. The review of the relationship according to groups of items of the CPI that have or do not have regulated prices suggests that the pass-through to domestic prices occurs mainly on the group of goods and services with regulated price. In addition, there is evidence of heterogeneity in price response by subclasses of items.
- Wage inequality and firm productivity: analysis with employer-employee dataEn los últimos años ha habido un aumento de la desigualdad de los ingresos en Costa Rica. Esta nota técnica estudia la relación entre la desigualdad salarial entre firmas y la productividad de las empresas en el país, en el marco del proyecto LinkEED de la OCDE. El análisis se llevó a cabo utilizando un procedimiento empírico proporcionado por la OCDE con una base de datos del Banco Central de Costa Rica que vinculada información entre empleadores y empleados en el período 2006 a 2017. Los resultados indican que la desigualdad salarial aumentó levemente en Costa Rica entre 2006 y 2017. El 36% de ese aumento se debió a la dispersión salarial entre empresas. Esto parece explicarse completamente por un aumento de las diferencias en la composición de la fuerza laboral entre empresas, mientras que la dispersión entre empresas debido a factores relacionados con el premio salarial que pagan las empresas se redujo. Además, se estimó que, en este periodo, el traspaso de la productividad de las firmas a los salarios fue de alrededor de 0,05%.