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Volatility And Irish Exports

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  • DON BREDIN
  • JOHN COTTER

Abstract

We analyze the impact of volatility per se on real exports for a small open economy concentrating on Irish trade with the United Kingdom and the United States. An important element is that we take account of the time lag between the trade decision and the actual trade or payments taking place by using a flexible lag approach. Rather than adopting a single measure of risk, we adopt a spectrum of risk measures and detail varied size characteristics and statistical properties. We find that the ambiguous results found to date may be due to not taking account of the timing effect, which varies substantially depending on which volatility measure is used. (JEL C32, C51, F14, F31)

Suggested Citation

  • Don Bredin & John Cotter, 2008. "Volatility And Irish Exports," Economic Inquiry, Western Economic Association International, vol. 46(4), pages 540-560, October.
    • Handle: RePEc:bla:ecinqu:v:46:y:2008:i:4:p:540-560
    DOI: 10.1111/j.1465-7295.2007.00101.x
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    Cited by:

    1. Grier, Kevin B. & Smallwood, Aaron D., 2013. "Exchange rate shocks and trade: A multivariate GARCH-M approach," Journal of International Money and Finance, Elsevier, vol. 37(C), pages 282-305.

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    More about this item

    JEL classification:

    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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