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Uncertainty and Export Performance: Evidence from 18 Countries

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  • KEVIN B. GRIER
  • AARON D. SMALLWOOD

Abstract

We study a sample of nine developed and nine developing countries to evaluate the questions of how foreign income uncertainty and real exchange rate (RER) uncertainty impact international trade and how those impacts vary according to stage of development. RER uncertainty has a negative and significant impact on export growth for six of the nine less developed countries in our sample, while it has an insignificant effect for a majority of the developed countries. In both groups, foreign income uncertainty has a more pervasively significant (and frequently larger) influence on trade than does RER uncertainty. Copyright 2007 The Ohio State University.

Suggested Citation

  • Kevin B. Grier & Aaron D. Smallwood, 2007. "Uncertainty and Export Performance: Evidence from 18 Countries," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 39(4), pages 965-979, June.
  • Handle: RePEc:mcb:jmoncb:v:39:y:2007:i:4:p:965-979
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