The Exchange Rate in Israël : Policy and Opinion

The exchange rate in Israel : police and opinion Throughout its thirty year history, Israel has had balance of payments deficits. Exchange control was in force until October 1977, and infrequent formal devaluations were supplemented by frequent small effective devaluations, by use of taxes and subsidies. These policies have aroused intensive debate among economises.. The main arguments concerned the desirability of exchange control, and the process of devaluation. In particular, opinions differed concerning relative effectiveness of large, infrequent devaluations compared to small, frequent devaluations. Regardless of the outcome of this debate, the high rates of inflation in recent years have necessitated more frequent devaluations, culminating in the adoption of a fluctuating rate system. Government intervention aimed at encouraging investment and, in particular, export is common in many of the industriel countries and in virtually all less developed countries.Tout au long de ses trente ans d'histoire, la balance des paiements d'Israël a été déficitaire. Jusqu'en octobre 1977, le contrôle des changes était en cours et les quelques dévaluations officielles étaient, en fait, suppléées — sous couvert d'impôts et de subventions — par de fréquentes petites dévaluations. Ces pro­cédés ont soulevé d'intenses débats parmi les économistes. Les arguments principaux portaient sur les avantages d'un contrôle des changes ainsi que sur le procédé de dévaluation. Les opinions différaient, en particulier; quant à l'efficacité relative de grandes dévaluations occasionnelles comparées à des dévaluations de moindre importance mais plus fréquentes. Quelles que soient les conclusions de ces débats, l'importance des taux d'inflation de ces dernières années a entraîné la nécessité de dévaluations de plus en plus fréquentes et jusqu'à l'adoption d'un système de change flottant.Halevi Nadav. The Exchange Rate in Israël : Policy and Opinion. In: Revue économique, volume 30, n°1, 1979. pp. 10-30

Trade Across the Mediterranean: An exploratory investigation

This paper examines trade across the Mediterranean against the background of the efforts to foster both North-South and intra-South trade flows as engines of growth. We first consider the shares of these regions (and of the countries constituting them) in the trade of each other as indicators of trade importance; and relative trade intensity indices – the ratio of these shares to the corresponding ones in the trade of the rest of the world – as measures of trade affinity and as means of identifying 'natural' trade partners. Because of the sheer size disparity, trade with the North-Med is more important to the South-Med than the other way round. But both regions display trade affinities with each other, making them natural trading partners, though there are wide disparities between individual countries within each region. Insofar as being natural trading partners forms a criterion for economic integration, there are promising prospects for some form of integration between the countries on the North and the South littorals of the Mediterranean. Contrary to the popular view of Arab South-Med trade being dominated by cultural, religious and linguistic commonalities, our findings show that geography still matters: the Arab South-Med affinity with the group of EU countries not lying on the Mediterranean littoral is much lower than with those that do. Arab commonality also seems to be more important in the trade of the Levant than in that of the Maghreb, whose trade affinities with its former colonial powers suggest the colonial heritage there to be still of importance. More generally, the differences observed here between the Maghreb and the Arab Levant have relevance to the EU's Barcelona Process policy, which encourages the formation of a South Mediterranean Free Trade Area. The findings of our study suggest that though the Arab Levant constitutes indeed a natural trading area, this is not as true for the region as a whole

Trade Across the Mediterranean: An exploratory investigation

This paper examines trade across the Mediterranean against the background of the efforts to foster both North-South and intra-South trade flows as engines of growth. We first consider the shares of these regions (and of the countries constituting them) in the trade of each other as indicators of trade importance; and relative trade intensity indices – the ratio of these shares to the corresponding ones in the trade of the rest of the world – as measures of trade affinity and as means of identifying 'natural' trade partners. Because of the sheer size disparity, trade with the North-Med is more important to the South-Med than the other way round. But both regions display trade affinities with each other, making them natural trading partners, though there are wide disparities between individual countries within each region. Insofar as being natural trading partners forms a criterion for economic integration, there are promising prospects for some form of integration between the countries on the North and the South littorals of the Mediterranean. Contrary to the popular view of Arab South-Med trade being dominated by cultural, religious and linguistic commonalities, our findings show that geography still matters: the Arab South-Med affinity with the group of EU countries not lying on the Mediterranean littoral is much lower than with those that do. Arab commonality also seems to be more important in the trade of the Levant than in that of the Maghreb, whose trade affinities with its former colonial powers suggest the colonial heritage there to be still of importance. More generally, the differences observed here between the Maghreb and the Arab Levant have relevance to the EU's Barcelona Process policy, which encourages the formation of a South Mediterranean Free Trade Area. The findings of our study suggest that though the Arab Levant constitutes indeed a natural trading area, this is not as true for the region as a whole.