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Merchandise Trade Balances of Less Developed Countries and Exchange Rate of the U.S. Dollar: Cases of Iran, Venezuela & Saudi Arabia Author info | Abstract | Publisher info | Download info | Related research | Statistics Ayoub Yousefi
This study examines the effects of changes in the exchange rate of the U.S. dollar on the trade balances of three oil-exporting countries, Iran, Venezuela, and Saudi Arabia. An exchange rate pass-through model is applied to allow changes in the exchange rate of the dollar to affect prices of traded goods. We found that changes in the effective exchange rate of the dollar pass through partially to these countries' import prices. For the export prices, under the floating exchange rate system depreciation of the dollar was found to cause export prices of these countries (except Saudi Arabia) to rise. While changes in the exchange rate of the dollar influence these countries' trade balances, the long-run trade balance adjustments seem to follow different patterns and time profiles.
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Paper provided by University of Waterloo, Department of Economics in its series Working Papers with number
00002.
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Length: 37 pages
Date of creation: Feb 2000Date of revision:
Feb 2000Handle: RePEc:wat:wpaper:00002Contact details of provider: Postal: Waterloo, Ontario, N2L 3G1 Phone: (519) 888-4567 ext 3695 Fax: (519) 725-0530 Web page: http://economics.uwaterloo.ca/ More information through EDIRC
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Keywords: Trade Balance ; J-curve ; Invoicing Currency ; Exchange Rate pass-through ; Crude Oil. ; Find related papers by JEL classification: F31 - International Economics - - International Finance - - - Foreign Exchange F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
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389, Board of Governors of the Federal Reserve System (U.S.).
[Downloadable!]
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