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Exchange-rate volatility and industry trade between the U.S. and Malaysia

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Listed author(s):
  • Bahmani-Oskooee, Mohsen
  • Harvey, Hanafiah

Abstract

Previous research that investigated the impact of exchange rate volatility on the trade flows of Malaysia concentrated only on the aggregate exports of Malaysia to the rest of the world. In this paper we first concentrate on the trade flows between Malaysia and the U.S. After showing that exchange rate volatility has neither short-run nor long-run effect on the trade flows between the two countries, we disaggregate the trade data by industry and consider the experience of 101 U.S. exporting industries to Malaysia and 17 U.S. importing industries from Malaysia. While exchange rate volatility seems to have significant short-run effects on the trade flows of most industries, short-run effects translate into the long run only in a limited number of small industries.

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File URL: http://www.sciencedirect.com/science/article/pii/S0275-5319(11)00003-1
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Article provided by Elsevier in its journal Research in International Business and Finance.

Volume (Year): 25 (2011)
Issue (Month): 2 (June)
Pages: 127-155

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Handle: RePEc:eee:riibaf:v:25:y:2011:i:2:p:127-155
Contact details of provider: Web page: http://www.elsevier.com/locate/ribaf

Keywords: Malaysia U.S. Commodity trade Exchange rate volatility;

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  1. Koi Nyen Wong, 2008. "The effects of exchange rate variability on Malaysia's disaggregated electrical exports," Journal of Economic Studies, Emerald Group Publishing, vol. 35(2), pages 154-169, May.
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  8. Lastrapes, William D. & Koray, Faik, 1990. "Exchange rate volatility and U.S. multilateral trade flows," Journal of Macroeconomics, Elsevier, vol. 12(3), pages 341-362.
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Cited by:

  1. Chi, Junwook & Cheng, Seu Keow, 2016. "Do exchange rate volatility and income affect Australia’s maritime export flows to Asia?," Transport Policy, Elsevier, vol. 47(C), pages 13-21.
  2. Bahmani-Oskooee, Mohsen & Aftab, Muhammad, 2017. "On the asymmetric effects of exchange rate volatility on trade flows: New evidence from US-Malaysia trade at the industry level," Economic Modelling, Elsevier, vol. 63(C), pages 86-103.
  3. Bahmani-Oskooee Mohsen & Hegerty Scott W. & Xu Jia, 2012. "Exchange-Rate Volatility and Industry Trade Between Japan and China," Global Economy Journal, De Gruyter, vol. 12(3), pages 1-21, September.
  4. Wang, Yi-Hsien & Lee, Jun-De, 2012. "Estimating the import demand function for China," Economic Modelling, Elsevier, vol. 29(6), pages 2591-2596.

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