Badinger, Harald, Fichet de Clairfontaine, Aurélien. 2018. Trade Balance Dynamics and Exchange Rates: In Search of the J-Curve Using a Structural Gravity Approach.
This paper uses a structural gravity approach, specifying currency movements as trade cost component to derive an empirical trade balance model, which incorporates multilateral resistance terms and accounts for the cross-country variation in the exchange rate pass-through into import and export prices. The model is estimated using quarterly bilateral trade flows between 47 countries over the period 2010Q1-2017Q2, disaggregated into 97 commodity groups. Our results support the existence of an "aggregate'' J-curve, pooled over commodity groups; at the same time they point to considerable heterogeneity in the trade balance dynamics across industries below the surface of aggregate data.
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|Status of publication||Published|
|Type of publication||Working/discussion paper, preprint|
|Title||Trade Balance Dynamics and Exchange Rates: In Search of the J-Curve Using a Structural Gravity Approach|
|JEL||F12, F31, F32|
- Badinger, Harald (Details)
- Fichet de Clairfontaine, Aurélien (Former researcher)
- Institute for International Economics IN (Details)
- Research areas (ÖSTAT Classification 'Statistik Austria')
- 1807 Economic geography (Details)
- 5300 Economics (Details)
- 5314 Trade Research (Details)