Résumé
Real exchange rates are a major short-run determinant of any country's capacity to compete. In this paper, we compute a unit-labour-costs-based real exchange rate for Switzerland for the period 1980-2006. This study uses manufacturing sector data on wages and labour productivity in Switzerland and twelve of its major trade partners and present detailed findings on relative labour costs and relative productivity trends. Our main findings are that, measured in these terms, the Swiss real exchange rate depreciated by some 9% in the period under analysis and that this improvement in competitiveness is essentially due to Swiss wage moderation. At a bilateral level, results highlight diverging trends: a significant gain of competitiveness is observed vis-à-vis Germany, Italy, the UK, Spain, Australia and Japan while a loss occurred with respect to the US, France, Belgium and Sweden.
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Extrait
Unit Labour Costs, the Real Exchange Rate and Swiss Competitiveness
1 Introduction
Economists and policy makers often refer to the notion of competitiveness when trying to gauge past performances and future perspectives of any economy. The concept started to enter the political and academic debate in the early 1980s. Meanwhile, although some contributions openly question its relevance (Krugman 1994 and 1996), a large number of influential research institutes and international authorities regularly investigate this issue.Definitions of competitiveness and of its relevant determinants vary across studies.1 As far as the short term is concerned, there is, however, a broad consensus regarding the role of exchange rates and, more specifically, of real exchange rates. With this respect, a well-established indicator of competitiveness is relative unit labour costs. The latter can indeed be seen as a form of real exchange rate in which...Voir le contenu complet de ce document
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