analyze the effects of devaluation on GDP per capita growth in Ethiopia using time series data from 1980 to 2010.

Beside the exchange rate I use variables such as education, private
investment, openness to determine Ethiopian GDP per capita growth. The study showed that
devaluation has a negative effect on GDP per capita the same year whereas the coefficient for the
one year lagged exchange-rate was significantly positive thus devaluation has a time varying
effect. Education had an expansionary effect and drought a contractionray effect on GDP per
capita growth.

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