The Recent Decline in Agricultural Exports: Is the Exchange Rate the Culprit?

Abstract

Similarly, Schuh, using the nominal agricultural export and exchange rate data plotted in chart 1, concludes that "the export boom of the lErOs is seen to be closely tied to the fall in the value of the dollar. The decline in our export performance is closely associated with the rise in the value of the dollar in the 1980s." OS/as S. Batten is a senior economist and Michael 11 Be/on gia is an economist at the Federal Resenie Bank of St Louis. Sarah R. Driver provided research assistance. 'Chattin and Lee (1983), p. 19.

World oil prices and agricultural commodity prices: The evidence from China

“…His findings were important and were consistent with others' findings that the money supply/value of the dollar plays some role in the level of the agricultural trade. In contrast, Batten and Belongia (1984) support the view that the exchange rates do not matter. Batten and Belongia argue that the real stimulus for the export demand comes from the income enhancements in the importing countries.…”

The Effects of Macroeconomic Announcements on Commodity Prices

“…Hence the significant reactions to the money supply surprises and the insignificant reactions to the discount rate changes. This argument is supported by the theoretical results of Chambers and the empirical results of Chambers andJust (1981, 1982) and Orden, although Belongia (1984, 1986) dispute their findings.…”

“…Many theoretical and empirical studies have illustrated the significant impact of macroeconomic disturbances on agriculture. The bulk of the empirical literature by Chambers (1981Chambers ( , 1984Chambers ( , 1985; Chambers andJust (1981, 1982); Belongia and King; Barnett, Bessler, and Thompson;andBelongia (1984, 1986), for example, has focused on the effects of monetary variables and exchange rates on agricultural prices, exports and inventories. While the theoretical literature has generally addressed these same issues, recent structural models of commodity price determination by Bond, Chambers, Frankel and Hardouvelis, and Frankel emphasize the important role of expectations concerning macroeconomic disturbances in the price formation process.…”

U.S. Agricultural Trade with Mexico

“…Following the works of Batten andBelongia (1984 and1986), Belongia (1986), Brada and Mendez (1988), and Bahmani-Oskooee and Ltaifa (1992) …”

“…Batten and Belongia (1984) addressed this problem, attributing part of the blame to the fundamental differences between nominal and real exchange rates. Using data for 1981-83, they found that real exchange rates were negatively related to exports, but their impact was dominated by the level of real GNP of the importing countries.…”