Winners and losers of foreign exchange rationing: the case of Ethiopia (Dev Policy Blog)

DevPolicyBlog (Australia) published an article on how Ethiopia has similarities and differences to Papua New Guinea (PNG). Like PNG, Ethiopia experienced an economic boom in the mid to late 2000s, and exchange rate appreciation, followed by an external shock that reduced the flow of foreign exchange into the country. This time was followed by foreign exchange shortages and rationing. Unlike PNG, Ethiopia is not a resource-dependent economy. Researchers from IFPRI and the Ethiopian Development Research Institute built a model that found several adverse distributional effects of rationing in Ethiopia.  Its results are relevant to PNG today due to the system of exchange rate rationing PNG has had in place since 2014. Also published in Zehabesha (Ethiopia)