أثر تخفيض قيمة العملة على النمو الاقتصادي : حالة ليبيا

Abstract EN

This paper examines the impact of Currency devaluation on economic growth in the Libyan economy.

The study used an econometric model, including time series data and employing co- integration method and error correction model for the period (1970-2010).

The results obtained confirm the existence of long-run relationship between exchange rate, fiscal and monetary policies and non-oil GDP.

The results suggest that currency devaluation has a negative effect on economic growth in the long-run.

This indicates that contractionary effect takes place in the long-run, while expansionary effect in the short-run.

The main recommendation of the study states that devaluation should be handled with extreme caution by policy makers, accompanied with full coordination with the management of fiscal and monetary policies.