Exchange Rate Volatility Effect on Economic Growth under Different Exchange Rate Regimes: New Evidence from Emerging Countries Using Panel CS-ARDL Model
Round 1
Reviewer 1 Report
Comments for author File: 
Comments.pdf
Author Response
Dear reviewer,
I'd like to thank you for your helpful comments and suggestions for improving the quality of our paper.
Attached you will find the cover letter which contains all the changes and the necessary explanations.
kind regards,
Author Response File: Author Response.pdf
Reviewer 2 Report
Dear Authors,
First and foremost i'd like to thank you for your submission. I enjoyed reading your paper, which topic is currently of utmost importance.
As such your paper is sound, however, there is an analysis i'd like to see (somehow) in your article : the current environment is fairly volatile, partialy due to liquidity issue, partially due to risk issues (i sense that there is some relationships between exchange rate volatility and risk premium evolutions) and partially due to other macro economic elements.... I wonder what actually drives that volatility.
I actually wonder if we observe more a volatility of the exchange rates or a volatility of the perceived underlying systemic risk premium.
I hope my point is clear and actually makes sense.
I also would recommend have the paper checked by a native English.
Once these points have been addressed, i would deem your paper suitable for publication.
Best regards,
Your reviewer
Author Response
Dear reviewer,
I'd like to thank you for your helpful comments and suggestions for improving the quality of our paper.
Attached you will find the cover letter which contains all the changes and the necessary explanations.
kind regards,
Author Response File: Author Response.pdf
Reviewer 3 Report
The paper is carefully written and structured. I have to admit that i do not understand garch, so i can't comment on the usefulness of using garch.
One minor spelling error. Real not reel. The authors are not fishermen.
I think that there is something seriously wrong with the following statement. The effect is bigger in the long run, not smaller in the long run.
Regarding the crucial component of our model, exchange rate volatility, we observe 458 that it has a significant negative short-term impact at the 10% level. Economic growth is 459 penalized by almost 0.013% for every 1% increase in REER volatility. However, our results 460 show that this effect deteriorates in the long run, with a 0.075% loss in economic growth 461 for every 1% increase in exchange rate volatility
My feeling is that the paper should be published as it is (with the above two issues corrected. However, I would not assign this paper to a class, except to encourage students to improve it. The volatility of the real exchange rate is an endogenous variable. My guess is that the contries with the most volatile exchange rates are those with the most volatile monetary and fiscal policies, which results in the most volatile inflation and that the volatility of the exchange rate proxies for the volatility of monetary policy, fiscal policy, and consequently inflation. Consequently, my guess is that the policy implication is volatility of macro policy is the devilish influence. Moreover, these are more exogenous than the volatility of the exchange rate. I think the most useful papers are those which assess the impact of policy instruments rather than endogenous variables. I would like to see the authors address this issue in future papers. they have most of the data, so why not run with this idea in the future?
Author Response
Dear reviewer,
I'd like to thank you for your helpful comments and suggestions for improving the quality of our paper.
Attached you will find the cover letter which contains all the changes and the necessary explanations.
kind regards,
Author Response File: Author Response.pdf
Round 2
Reviewer 1 Report
I think the current revision addresses most of my concerns. The only remaining reservation that I have is that I would like to see in the paper an explicit discussion of the difficulties in identifying a long-run volatility from the short-run volatility in your data set as a justification for not taking the deviations of the long-run volatility implied in the GARCH models as the relevant indicator.
A minor point in the last session in grey "Primo" and "Segundo" should probably be substituted with "First" and "Second".
Author Response
Dear reviewer,
First, we would like to thank you for devoting your time and knowledge to offering us pertinent comments and suggestions that allowed us to improve the quality of our paper.
Attached you will find the cover letter, which contains all the changes.
We hope that all the changes meet your expectations.
Kind regards,
Author Response File: Author Response.pdf
