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Determinants of Exports in a Small and Vulnerable Economy: Fiji Islands—A Disaggregated Analysis

Author

Listed:
  • Ronal Chand

    (The University of the South Pacific)

  • Rup Singh

    (The University of the South Pacific)

  • Sumeet Lal

    (The University of the South Pacific)

  • Nilesh Chand

    (The University of the South Pacific
    Fijian Competition and Consumer Commission)

  • Devendra Kumar Jain

    (The University of the South Pacific)

Abstract

The previous studies of exports performance in Fiji were carried out at the aggregate level. We conduct a disaggregated analysis of exports of three major products, namely, sugar, tourism, and gold. This analysis is useful for developing sector-based export promotion policies. The long run as well as dynamic export demand functions are estimated at the aggregate and disaggregate levels. The results identify a number of factors such as trading partner income, relative prices, productivity shocks, natural disasters, political disturbances, and the exchange rate that affect the export demand for sugar, tourism, and gold, though not in the same way. For instance, tourism and sugar enjoy the highest income elasticity. Sugar export is adversely affected by natural calamities and political upheavals. The political upheavals also affect tourism adversely in Fiji. The exchange rate affects the export of sugar more than others. The idea that devaluation will promote exports in Fiji needs careful investigation because results show that this will happen with a high cost, i.e. 5% nominal devaluation will be required to increase real exports by 1%.

Suggested Citation

  • Ronal Chand & Rup Singh & Sumeet Lal & Nilesh Chand & Devendra Kumar Jain, 2022. "Determinants of Exports in a Small and Vulnerable Economy: Fiji Islands—A Disaggregated Analysis," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(6), pages 2948-2969, December.
    • Handle: RePEc:pal:eurjdr:v:34:y:2022:i:6:d:10.1057_s41287-022-00506-4
    DOI: 10.1057/s41287-022-00506-4
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    References listed on IDEAS

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    More about this item

    Keywords

    Determinants of exports; Export promotion policies; Elasticities of exports; Small and vulnerable economies; Fiji;
    All these keywords.

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • B40 - Schools of Economic Thought and Methodology - - Economic Methodology - - - General

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