Exchange-rate volatility and commodity trade between the U.S. and Germany: asymmetry analysis

Bahmani‐Oskooee, Mohsen; Nouira, Ridha; Saafi, Sami

doi:10.1007/s10368-019-00455-0

Cited by 6 publications

(1 citation statement)

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“…Bahmani-Oskooee and Aftab examined the dynamic effects of exchange rate volatility on bilateral trade flows between the U.S.A. and Malaysia and found that short- and long-run asymmetric effects exist in one third of the industries ( 20 ). In addition, Bahmani-Oskooee et al investigated the effects of exchange rate volatility on commodity trade between the U.S.A. and Germany ( 21 ). The results showed that long-run asymmetric effects were found in 19 U.S. exporting and 32 U.S. importing industries, respectively.…”

Section: Literature Reviewmentioning

confidence: 99%

Asymmetric Exchange Rate Effects on Cross-Border Freight Flows between the United States and Canada

Chi

2020

Transportation Research Record: Journal of the Transportation R

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This paper investigates possible asymmetric influences of the exchange rate on cross-border freight flows between the U.S.A. and Canada. Linear and nonlinear autoregressive distributed lag models are used to test for the existence of long-run asymmetric effects of 1) currency appreciation and depreciation and 2) exchange rate volatility changes on trade flows by truck, rail, air, vessel, and pipeline. This paper provides evidence that both currency value and exchange rate volatility affect the U.S.–Canada freight flows in an asymmetric manner. The long-run results of the nonlinear models show that exchange rate is found to be significantly associated with the bilateral trade flows between the U.S.A. and Canada. Exchange rate volatility tends to be significantly associated with trade flows in the nonlinear models, while its effects are insignificant in most cases in the linear models. These findings suggest that the conventional linear specification may mislead the asymmetric effects of exchange rate uncertainty on cross-border freight flows. It is also found that exchange rate sensitivities of U.S.–Canada trade flows by transport mode can differ significantly from those of aggregate trade flows. The information derived from disaggregate trade data can be useful for traders and shippers to develop a long-term strategic plan for infrastructure investment and service expansion.

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Section: Literature Reviewmentioning

confidence: 99%

Asymmetric Exchange Rate Effects on Cross-Border Freight Flows between the United States and Canada

Chi

2020

Transportation Research Record: Journal of the Transportation R

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The Impacts of the Dollar-Renminbi Exchange Rate Misalignment on the China-United States Commodity Trade: An Asymmetric Analysis

et al. 2022

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Contrary to most existing studies of the literature that assumed that the effects of real exchange rate (RE) misalignment on trade flows are symmetric, this paper considers a more general and realistic framework allowing for possible asymmetric effects. We use monthly time-series data over the January 2002-October 2020 period from 66 two-digit industries that trade between China and the U.S. in order to avoid the well-known aggregation bias. Estimates of symmetric errorcorrection models (ECM) revealed that real dollar-renminbi rate misalignment has short-run effects on 35 U.S. exporting and 53 U.S. importing industries. These short-run effects translated into the long run in 18 and 17 industries, respectively. The numbers increased considerably when estimating asymmetric ECM. Indeed, short-run asymmetric effects were then found in 47 U.S. exporting and 62 U.S. importing industries, which translated into long-run asymmetric effects in 20 U.S. exporting and 21 U.S. importing industries. Our analysis highlights the importance of separating currency overvaluation from currency undervaluation in assessing the effects of the RE misalignment on trade flows between the U.S. and China and confirms that the impacts are industry specific. Our findings (robust to possible structural breaks) are useful for trading industries, and policymakers, and advocate accounting for asymmetries when examining the RE misalignment-trade flows nexus.

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Asymmetric effects of exchange rate volatility on trade flows in BRICS economies

Anyikwa

Domela

2022

Studies in Economics and Econometrics

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Exchange-rate volatility and commodity trade between the U.S. and Germany: asymmetry analysis

Cited by 6 publications

References 43 publications

Asymmetric Exchange Rate Effects on Cross-Border Freight Flows between the United States and Canada

Asymmetric Exchange Rate Effects on Cross-Border Freight Flows between the United States and Canada

The Impacts of the Dollar-Renminbi Exchange Rate Misalignment on the China-United States Commodity Trade: An Asymmetric Analysis

Asymmetric effects of exchange rate volatility on trade flows in BRICS economies

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