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Is there a J-curve for Azerbaijan? New evidence from industry-level analysis

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  • Mohsen Bahmani-Oskooee
  • Salman Huseynov
  • Rustam Jamilov

Abstract

This paper estimates the J-curve for Azerbaijan using quarterly industry-level data over the 2000--2009 period. Empirical results show that in 3 of the 10 strategic industries there is strong evidence for the fulfilment of the Marshall--Lerner condition, as the trade balance improves in the long run in reaction to a currency devaluation. In most industries the J-curve pattern is observed in the short run. All 10 cases exhibit long-run cointegration and are stable according to the CUSUM and CUSUMSQ stability tests. These findings are largely consistent with the existing literature on the Azerbaijani J-curve and carry important policy implications.

Suggested Citation

  • Mohsen Bahmani-Oskooee & Salman Huseynov & Rustam Jamilov, 2014. "Is there a J-curve for Azerbaijan? New evidence from industry-level analysis," Macroeconomics and Finance in Emerging Market Economies, Taylor & Francis Journals, vol. 7(1), pages 83-98, March.
    • Handle: RePEc:taf:macfem:v:7:y:2014:i:1:p:83-98
    DOI: 10.1080/17520843.2013.831366
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    2. Jamilov, Rustam, 2011. "J-Curve Dynamics and the Marshall-Lerner Condition: Evidence from Azerbaijan," MPRA Paper 36799, University Library of Munich, Germany, revised Feb 2012.
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    Cited by:

    1. Peguero, Anadel G. & Cruz-Rodríguez, Alexis, 2016. "Condición Marshall-Lerner y el efecto Curva J: Evidencias para la República Dominicana [Marshall-Lerner Condition and J-Curve Effect: Evidence for the Dominican Republic]," MPRA Paper 71535, University Library of Munich, Germany.
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    3. Mohsen Bahmani-Oskooee & Rustam Jamilov, 2014. "Export diversification and the S-curve effect in a resource-rich state: evidence from Azerbaijan," Economic Change and Restructuring, Springer, vol. 47(2), pages 135-154, May.

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