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China’s trade in services and role of the exchange rate: An asymmetric analysis

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  • Xu, Jia
  • Bahmani-Oskooee, Mohsen
  • Karamelikli, Huseyin

Abstract

Nearly all studies in the literature have assessed the impact of exchange rate changes on trade flows for goods. Service industries, however, have not received much attention. Two studies have assessed the effects of exchange rate changes on U.S. service trade with its partners. We add to this literature with a new study that assesses the symmetric and asymmetric effects of changes in the real effective rate of the yuan on China’s trade in 11 service industries with the world. While we find short-run effects on imports and exports for almost all service categories, short-run effects last into long-run asymmetric effects in six Chinese importing service industries and eight Chinese exporting service industries.

Suggested Citation

  • Xu, Jia & Bahmani-Oskooee, Mohsen & Karamelikli, Huseyin, 2022. "China’s trade in services and role of the exchange rate: An asymmetric analysis," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 747-757.
    • Handle: RePEc:eee:ecanpo:v:74:y:2022:i:c:p:747-757
    DOI: 10.1016/j.eap.2022.04.006
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    References listed on IDEAS

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    More about this item

    Keywords

    China; Trade in services; Real effective exchange rate; Asymmetric analysis;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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