We study the influence of the exchange rate on the speed of economic recovery in a sample of 67 developed and developing economies over the years 1989–2019. First, using a cross-sectional sample of 341 economic recoveries, we study the effect of nominal depreciation and real undervaluation on the length of economic recovery. Our findings indicate that a small nominal depreciation, as well as a real undervaluation of the domestic currency, increases the speed of economic recovery. However, this effect is small in size. Second, we use an interacted panel VAR (IPVAR) model to investigate the effect of real undervaluation on the speed of economic recovery after an external shock. While we once again find evidence that an undervalued domestic currency increases the speed of economic recovery, its positive effect is limited in size. Furthermore, we also explore the role of financial development in influencing the effectiveness of an undervalued domestic currency in stimulating economic recovery. We find that a higher level of financial development limits the negative effect of an overvalued currency on the speed of economic recovery, but does not influence the effect of an undervalued currency on economic recovery.

中文翻译：

---

汇率与经济复苏速度：金融发展的作用

我们研究了 1989 年至 2019 年间汇率对 67 个发达经济体和发展中经济体经济复苏速度的影响。首先，我们利用341个经济复苏的横截面样本，研究名义贬值和实际低估对经济复苏时长的影响。我们的研究结果表明，名义小幅贬值以及本国货币的实际低估会加快经济复苏的速度。然而，这种影响的规模很小。其次，我们使用交互面板VAR（IPVAR）模型来研究实际低估对外部冲击后经济复苏速度的影响。虽然我们再次找到证据表明，本币被低估可以加快经济复苏的速度，但其积极作用的规模有限。此外，我们还探讨了金融发展对低估本币刺激经济复苏的有效性的影响。我们发现，较高的金融发展水平限制了货币高估对经济复苏速度的负面影响，但不影响货币低估对经济复苏的影响。