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Exchange Rate Volatility and Trade Flows of the U.K. in 1990s

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  • Hae-du Hwang
  • Jin-woo Lee

Abstract

This paper examines the impact of exchange rate volatility on trade flows in the U.K. over the period 1990–2000. According to the conventional approach, exchange rate volatility clamps down trade volumes. This paper, however, identifies the existence of a positive relationship between exchange rate volatility and imports in the U.K. in the 1990s by using a bivariate GARCH-in-mean model. It highlights a possible emergence of a polarized version with conventional proposition that ERV works as an impediment factor on trade flows.

Suggested Citation

  • Hae-du Hwang & Jin-woo Lee, 2005. "Exchange Rate Volatility and Trade Flows of the U.K. in 1990s," International Area Studies Review, Center for International Area Studies, Hankuk University of Foreign Studies, vol. 8(1), pages 173-182, March.
    • Handle: RePEc:sae:intare:v:8:y:2005:i:1:p:173-182
    DOI: 10.1177/223386590500800109
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    References listed on IDEAS

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    Cited by:

    1. Bouoiyour, Jamal & Selmi, Refk, 2013. "Exchange rate uncertainty and export performance: what meta-analysis reveals?," MPRA Paper 49249, University Library of Munich, Germany, revised Aug 2013.
    2. Mauricio Vaz Lobo Bittencourt & Paula Andrea Mosquera Agudelo, 2021. "The impacts of the exchange rate volatility on colombian trade with its main trade partners," EconoQuantum, Revista de Economia y Finanzas, Universidad de Guadalajara, Centro Universitario de Ciencias Economico Administrativas, Departamento de Metodos Cuantitativos y Maestria en Economia., vol. 18(2), pages 57-81, Julio-Dic.
    3. Javaid, shahid hussain, 2020. "Exchange Rate Volatility and Exports of Pakistan," MPRA Paper 117426, University Library of Munich, Germany, revised 2021.
    4. Rashid Latief & Lin Lefen, 2018. "The Effect of Exchange Rate Volatility on International Trade and Foreign Direct Investment (FDI) in Developing Countries along “One Belt and One Road”," IJFS, MDPI, vol. 6(4), pages 1-22, October.

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