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Test of the J-curve for the DR-CAFTA countries and policy implications

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  • Hsing, Yu
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    Abstract

    There is evidence of a J-curve for the Dominican Republic and lack of support for a J-curve for Costa Rica, El Salvador, Guatemala, and Honduras. The trade balance responds to real depreciation positively for Costa Rica and El Salvador, negatively in the short run and positively in the long run for the Dominican Republic, negatively for Guatemala, and positively in the short run and negatively in the long run for Honduras. In response to real depreciation, the trade balance between the Dominican Republic and the U.S. adjusts from a negative to positive value very slowly.

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    Bibliographic Info

    Article provided by Elsevier in its journal Research in International Business and Finance.

    Volume (Year): 23 (2009)
    Issue (Month): 3 (September)
    Pages: 293-301

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    Handle: RePEc:eee:riibaf:v:23:y:2009:i:3:p:293-301

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    Web page: http://www.elsevier.com/locate/ribaf

    Related research

    Keywords: J-curve Trade balance Real depreciation Generalized response function VECM;

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