The Effect of Exchange Rate Changes on Trade in East Asia
AbstractThis paper considers how exchange rates affect East Asian trade. The evidence indicates that exports produced within regional production networks depend on exchange rates throughout the region while labor-intensive exports depend on exchange rates in the exporting country. These results make sense since the majority of the value-added of processed exports come from imported parts and components while most of the value-added of labor-intensive exports comes from the domestic economy. Recent findings also indicate that imbalances between the Peopleâ€™s Republic of China (PRC) and the United States are a major outlier and that an appreciation of the PRC yuan (CNY) is necessary to reduce these imbalances.
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Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Macroeconomics Working Papers with number 23274.
Date of creation: Jan 2011
Date of revision:
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Postal: JG Crawford Building #13, Asia Pacific School of Economics and Government, Australian National University, ACT 0200
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More information through EDIRC
effects of the exchange rate; trade; East Asia; regional production networks; exports; China; PRC;
Other versions of this item:
- Willem Thorbecke, 2011. "The Effect Of Exchange Rate Changes On Trade In East Asia," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(01), pages 85-102.
- Willem Thorbecke, 2011. "The Effect of Exchange Rate Changes on Trade in East Asia," Trade Working Papers 23274, East Asian Bureau of Economic Research.
- Willem Thorbecke, 2011. "The Effect of Exchange Rate Changes on Trade in East Asia," Finance Working Papers 23274, East Asian Bureau of Economic Research.
- Willem THORBECKE, 2006. "The Effect of Exchange Rate Changes on Trade in East Asia," Discussion papers 06009, Research Institute of Economy, Trade and Industry (RIETI).
- Thorbecke, Willem, 2011. "The Effect of Exchange Rate Changes on Trade in East Asia," ADBI Working Papers 263, Asian Development Bank Institute.
- F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
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