Relative Responsiveness of Trade Flows to a Change in Prices and Exchange Rate
AbstractA country can restrict her imports by imposing tariffs and stimulating her exports by providing subsidies. The same goal could be achieved through devaluation. One policy question that we face is the time it takes for either policy to affect the trade flows. We investigate here the relative responsiveness of the trade flows to a change in relative prices versus to a change in exchange rate. After estimating an error-correction version of import and export demand functions for nine industrial countries, unlike earlier studies that employed non-stationary data, our findings indicate that there is no specific answer and trade flows of different countries react differently.
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 International Review of Applied Economics.
Volume (Year): 17 (2003)
Issue (Month): 3 ()
Contact details of provider:
Web page: http://www.tandfonline.com/CIRA20
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bahmani-Oskooee, Mohsen, 1986. "Determinants of international trade flows : The Case of Developing Countries," Journal of Development Economics, Elsevier, vol. 20(1), pages 107-123.
- Helen B. Junz & Rudolf R. Rhomberg, 1973. "Price competitiveness in export trade among industrial countries," International Finance Discussion Papers 22, Board of Governors of the Federal Reserve System (U.S.).
- Bahmani-Oskooee, Mohsen, 2001. "How stable is M2 money demand function in Japan?," Japan and the World Economy, Elsevier, vol. 13(4), pages 455-461, December.
- Wilson, John F & Takacs, Wendy E, 1979. "Differential Responses to Price and Exchange Rate Influences in the Foreign Trade of Selected Industrial Countries," The Review of Economics and Statistics, MIT Press, vol. 61(2), pages 267-79, May.
- M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
- Junz, Helen B & Rhomberg, Rudolf R, 1973. "Price Competitiveness in Export Trade Among Industrial Countries," American Economic Review, American Economic Association, vol. 63(2), pages 412-18, May.
- Caporale, Guglielmo Maria & Chui, Michael K F, 1999. "Estimating Income and Price Elasticities of Trade in a Cointegration Framework," Review of International Economics, Wiley Blackwell, vol. 7(2), pages 254-64, May.
- Boyd, Derick & Caporale, Gugielmo Maria & Smith, Ron, 2001. "Real Exchange Rate Effects on the Balance of Trade: Cointegration and the Marshall-Lerner Condition," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 6(3), pages 187-200, July.
- WenShwo Fang & YiHao Lai & Stephen M. Miller, 2005. "Export Promotion through Exchange Rate Policy: Exchange Rate Depreciation or Stabilization?," Working papers 2005-07, University of Connecticut, Department of Economics.
- Bahmani-Oskooee, Mohsen & Goswamil, Gour G. & Talukdar, Bidyut Kumar, 2005. "Exchange rate sensitivity of the Canadian bilateral inpayments and outpayments," Economic Modelling, Elsevier, vol. 22(4), pages 745-757, July.
- Khurram Ashfaq Baluch & Syed Kalim Hyder Bukhari, 2012. "Price and Income Elasticity of Imports: The Case of Pakistan," Working Papers id:4899, eSocialSciences.
- WenShwo Fang & Stephen M. Miller, 2004.
"Exchange rate depreciation and exports: The case of Singapore revisited,"
2004-45, University of Connecticut, Department of Economics.
- WenShwo Fang & Stephen Miller, 2007. "Exchange rate depreciation and exports: the case of Singapore revisited," Applied Economics, Taylor & Francis Journals, vol. 39(3), pages 273-277.
- Fakhri, Hasanov, 2010. "The Impact of Real Effective Exchange Rate on the Non-oil Export: The Case of Azerbaijan," MPRA Paper 29556, University Library of Munich, Germany.
- Koi Nyen Wong & Tuck Cheong Tang, 2007.
"Exchange Rate Variability And The Export Demand For Malaysia'S Semiconductors: An Empirical Study,"
Monash Economics Working Papers
13-07, Monash University, Department of Economics.
- Koi Nyen Wong & Tuck Cheong Tang, 2009. "Exchange rate variability and the export demand for Malaysia's semiconductors: an empirical study," Applied Economics, Taylor & Francis Journals, vol. 43(6), pages 695-706.
- Hubert Gabrisch & Karsten Staehr, 2012.
"The Euro Plus Pact: Competitiveness and External Capital Flows in the EU Countries,"
324, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).
- Hubert Gabrisch & Karsten Staehr, 2012. "The Euro Plus Pact: Competitiveness and external capital flows in the EU countries," Bank of Estonia Working Papers wp2012-5, Bank of Estonia, revised 10 Dec 2012.
- Verheyen, Florian, 2013. "Exchange rate nonlinearities in EMU exports to the US," Economic Modelling, Elsevier, vol. 32(C), pages 66-76.
- Aviral Kumar Tiwari, 2012. "An Error-Correction Analysis Of India-Us Trade Flows," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 37(1), pages 29-51, March.
- Ammani, Aliyu Aishat, 2. "Impact Of Market-Determined Exchange Rates On Rice Production And Import In Nigeria," International Journal of Food and Agricultural Economics (IJFAEC), Niğde University, Faculty of Economics and Administrative Sciences, vol. 1.
- Fang, WenShwo & Lai, YiHao & Thompson, Henry, 2007. "Exchange rates, exchange risk, and Asian export revenue," International Review of Economics & Finance, Elsevier, vol. 16(2), pages 237-254.
- Mwebaze, Paul & Monaghan, J. & Revell, Brian J. & Hare, M. & MacLeod, Alan & Spence, N., 2008. "Modeling The Risks Associated With Increased Importation Of Fresh Produce From Emerging Supply Sources To The Uk," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 43963, European Association of Agricultural Economists.
- Mohsen Bahmani & Hanafiah Harvey & Scott W. Hegerty, 2013. "Empirical tests of the Marshall-Lerner condition: a literature review," Journal of Economic Studies, Emerald Group Publishing, vol. 40(3), pages 411-443, May.
- Sanidas, Elias & Jayanthakumaran, Kankesu, 2006. "The Consequences of Trade Liberalisation on the Australian Passenger Motor Vehicle Industry," Economics Working Papers wp06-01, School of Economics, University of Wollongong, NSW, Australia.
- Kodongo, Odongo & Ojah, Kalu, 2013. "Real exchange rates, trade balance and capital flows in Africa," Journal of Economics and Business, Elsevier, vol. 66(C), pages 22-46.
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.