Test of the Marshall-Lerner Condition for Eight Selected Asian Countries and Policy Implications
AbstractApplying a general functional form, the Marshall-Lerner condition of the bilateral trade between the US and Hong Kong, India, Japan, Korea, Malaysia, Pakistan, Singapore, or Thailand is examined. In deriving the real exchange rate, both the relative consumer price index (CPI) and producer price index (PPI) are considered. The results show that the widely used log-log form can be rejected for Singapore and Malaysia using either the relative CPI or PPI and is also inappropriate for India and Pakistan using the relative PPI. The Marshall-Lerner condition holds for India, Korea, Japan and Pakistan, is confirmed for Hong Kong, Singapore and Thailand using the relative CPI, and cannot be confirmed for Malaysia. Thus, in examining the Marshall-Lerner condition or the exchange rate behavior, non-linearity or the appropriateness of the functional form needs to be tested
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Global Economic Review.
Volume (Year): 39 (2010)
Issue (Month): 1 ()
Contact details of provider:
Web page: http://www.tandfonline.com/RGER20
You can help add them by filling out this form.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.