exchange rate volatility and export growth in nigeria this article examines the impact of exchange rate volatility on nigeria s exports to its most important trading partner the united states over the quarterly period january 1980 to april 2001 using cointegration and vector error correction vecm framework empirical tests indicate the presence of a unique cointegrating vector linking real exports real foreign income relative export prices and real exchange rate volatility in the long run furthermore the results show that increases in the volatility of the real exchange rate raise uncertainty about profits to be made which exert significant negative effects on exports both in the short and long run our results also show that improvements in the terms of trade represented by declines in the real exchange rate and real foreign income exert positive effects on export activity most importantly we found that the trade liberalization and economic reform policies implemented in the post 1986 structural adjustment period contributed to nigeria s export

the trade effects of antidumping duties evidence from the 2004 eu enlargement abstract this paper exploits the 2004 eu enlargement as a natural experiment to estimate the effects of antidumping ad duties on import prices and quantities the automatic extension of eu ad policy to new member states following their accession is exogenous to new members trade shocks using this source of variation the paper shows that on average ad duties raise producer prices of targeted exporters however import prices from countries with non market economy status nmes notably china remain unchanged while quantities fall more strongly this is in line with expectations as the eu applies special rules to nmes countries the trade dampening effects of ad duties persist over time moreover the duties appear to induce exporters from non targeted countries to increase their prices

short run exchange rate uncertainty in latin america this paper to obtain an ex ante measure of exchange rate uncertainty in 11 latin american countries as a preliminary issue the purchasing power parity ppp condition is tested using engle and granger two step procedure and johansen method the argument is that exchange rate uncertainty could be lower if ppp holds in the long run the expected exchange rate uncertainty is estimated according to an extended version of the autoregressive conditionally heteroscedastic arch model the results show that the arch adjusment produces more efficient estimates in seven countries and that the acceptance of ppp has little effect on exchange rate uncertainty

the monetary approach to exchange rate determination under rational expectations the dollar deutschmark rate abstract this paper reformulates the monetary approach after ascertaining that a money demand function with a partial adjustment mechanism had more empirical support than a money demand function which assumed instantaneous stock adjustment the resulting exchange rate equation is estimated by two rational expectations techniques the parameter estimates are reasonable and are robust to the estimation technique used to different specifications of the driving processes and to changes in the estimation period the structural model outperforms the random walk model and its own unconstrained equivalent a pure time series equation in outof sample forecasts

nonlinear dynamics in deviations from the law of one price a broad based empirical study abstract in this paper we test empirically the validity of the law of one price using data for five major bilateral us dollar exchange rates and nine goods sectors during the recent floating exchange rate regime since the early 1970s using threshold autoregressive models we find strong evidence of nonlinear mean reversion in deviations from the law of one price with plausible convergence speeds consistent with theoretical arguments on international goods markets arbitrage under transactions costs and with an emerging strand of empirical literature these results contribute towards forming a consensus view in favor of discrete regime switching in deviations from the law of one price and the presence of differing nonzero transactions costs across a broad range of goods and countries

transactions costs and vehicle currencies abstract using a simple model of transactions costs in the interbank foreign exchange market and a model of vehicle currency use the interaction between transactions costs and vehicle currency use is explored the impact of volume on bid ask spreads is estimated from cross section time series data on seven currencies data on transactions costs and the currency denomination of trade and capital transactions are used to estimate changes in the attractiveness of using the us dollar as a vehicle between 1980 and 1987 the data suggest a modest reduction in the attractiveness and use of the dollar as a vehicle

u s trade remedy law and agriculture trade diversion and investigation effects we study u s agricultural antidumping and countervailing duty cases from 1980 to 2005 and gauge the effectiveness of trade remedy law as a form of protection the purpose is to measure the resulting investigation and trade diversion effects previous research on trade in manufactured products has shown that the domestic protection offered by ad and cv duties is largely offset by trade diversion in contrast we find that for agriculture trade diversion is relatively unimportant so ad and cvd cases are very effective forms of protection for u s agriculture les auteurs etudient les cas de tarifs antidumping et de tarifs compensatoires dans l agriculture aux etats unis entre 1980 et 2005 et evaluent l efficience de cette forme de protection l objectif est de mesurer les effets resultant des enquetes et de la diversion de commerce des etudes anterieures sur le commerce de produits manufacturiers ont montre que la protection offerte par ces mesures antidumping et compensatoires etait largement contrebalancee par la diversion de commerce a contrario il appert qu en agriculture la diversion de commerce est relativement peu importante voila qui fait que les mesures antidumping et compensatoires sont des formes de protection efficientes pour l agriculture americaine

effects of exchange rate risk on exports crosscountry analysis abstract in this paper we investigate the effects of exchange rate uncertainty on the aggregate exports of 19 developed and 67 developing countries using cross sectional data exchange rate uncertainty is found to be detrimental to the exports of both developing and developed countries developed countries exports however are found to be less sensitive to exchange risk than that of developing countries furthermore within the developing countries those who fixed their exchange rates to one major currency were found to be subject to less risk than the other developing countries

discriminating monopoly forward markets and international trade recent empirical studies see e g kravis and lipsev 1977 1978 isard 1977 aspe and giavazi 1982 demonstrate that there are notable divergencies between domestic and export prices this empirical evidence suggests that the law of one price is systematically violated kravis and lipsey 1977 p 155 argue that many firms involved in international trade particularly manufacturers are in the position of a discriminating monopolist faced with separate markets each characterized by a different demand elasticity a model which explicitly allows for price discrimination has been used by several authors see for example aspe and giavazi 1982 ethier 1982 katz paroush and kahana 1982 and tarr 1979 katz paroush and kahana 1982 hereafter kpk used a model of a price discriminating firm which operates under price uncertainty to investigate its optimal level of output and sales in the two markets the main assumption made in kpk 1982 is that the firm determines its level of output and the allocation of sales between the two markets before the resolution of uncertainty furthermore no forward markets were available to this firm in this paper we analyze a price discriminating firm which sells its produce both in the domestic and on world markets under either exchange rate uncertainty or foreign price uncertainty this firm is a monopoly in the domestic market but a price taker on the world market our model differs substantially from the kpk model and in some cases conforms better with reality due to the following two assumptions first the firm determines its level of output before the resolution of uncertainty but decides about the optimal allocation of sales only after it observes the foreign price denominated in domestic currency secondly forward markets to share the exchange rate risk or the uncertain foreign commodity price are available and their impact on the firm s policy is analyzed hence this work integrates two strands of literature it combines studies on price discriminating firms some were mentioned above and studies on firm behavior when forward markets are available danthine 1978 holthausen 1979 katz and paroush 1979 feder just and schmitz 1980 in this paper we are mainly concerned with a firm which always exports this includes large

self enforcing trade agreements evidence from time varying trade policy the bagwell and staiger 1990 theory of cooperative trade agreements predicts new tariffs i increase with imports ii increase with the inverse of the sum of the import demand and export supply elasticities and iii decrease with the variance of imports the authors find us import policy during 1997 2006 to be consistent with this theory a one standard deviation increase in import growth the inverse of the sum of the import demand and export supply elasticity and the standard deviation of import growth changes the probability that the us imposes an antidumping tariff by 35 percent by 88 percent and by 76 percent respectively

symmetric pass through of tariffs and exchange rates under imperfect competition an empirical test abstract this paper examines the effect of tariffs and exchange rates on u s prices of japanese cars trucks and motorcycles in particular we test whether the long run pass through of tariffs and exchange rates are identical the symmetry hypothesis we find that this hypothesis is easily accepted in our sample we also find that the pass through relation varies across products ranging from about 0 6 for trucks to unity for motorcycles these coefficients have very different implications for trade policy we explain the results based on demand cost and institutional conditions in each industry

price discrimination by u s and german exporters the insensitivity of the u s trade balance to the sharp depreciation of the dollar in the past three years has revived interest in the relationship between exchange rates and the trade balance a central issue in most analyses of the relation between the current account and the exchange rate concerns the price adjustment process the simple integrated competitive market model predicts that local currency prices should change in proportion to the nominal exchange rate for a country too small to influence world prices the relationship between local currency import prices and exchange rates has been referred to as the pass through relationship in the empirical literature in international economics if the proportional relationship between import prices and exchange rates holds pass through is said to be complete accounts of recent u s experience cite the failure of dollar prices of imported goods to rise in proportion to exchange rates i e incomplete pass through as an important factor in explaining the persistence of the trade deficit unfortunately observations on pass through alone provide limited insight into the behavior of markets since incomplete pass through is consistent with at least two fundamentally different paradigms one is the standard competitive model of trade in which the law of one price holds but exchange rate fluctuations are associated with large changes in import demand due to other factors for example if dollar appreciation is correlated with increases in world demand and industry marginal cost is increasing then pass through will be less than complete the other is an imperfectly competitive model in which exporters are capable of price discriminating across destination markets a phenomenon paul krugman 1987 has labeled pricing to market in this model incomplete pass through is typically associated with fluctuations in the markup of price over marginal cost on exports 2 these fluctuations in markups are believed to be countryspecific they do not reflect the behavior of prices to other export destinations both models are plausible explanations of recent u s experience unfortunately it is impossible to distinguish between these competing models using only information on import prices and exchange rates for a single country in order to distinguish between the competing models an empirical analysis of goods prices and exchange rates must be capable of measuring either marginal cost or the markup over marginal cost either of these tasks poses formidable empirical problems much of the empirical literature in industrial organization has been concerned with precisely these issues since markups are an important measure of the competitiveness of industries

does antidumping use contribute to trade liberalization in developing countries some supporters of antidumping have argued that this procedure serves as a kind of safety valve for protectionist pressure in this paper we investigate whether there is empirical evidence that the use of antidumping actions has contributed to ongoing tariff reductions over the period 1988 to 2004 in a sample of 23 developing countries some of which have become aggressive users of antidumping in recent years the evidence is not supportive of the safety valve argument for these countries instead evidence suggests that past use of antidumping may have led to less rather than more trade liberalization

monetary union a welfare based approach abstract this article attempts to shed light on the consequences of the transition to emu for individual welfare following specific shocks to this end we develop a two country intertemporal general equilibrium model that extends the obstfeld and rogoff journal of political economy 103 3 1995 624 specification to nominal rigidities through price adjustment costs and pricing to market behavior we show that when facing a positive asymmetric permanent shock to either technology or government expenditures occurring in one country implementing a monetary union is beneficial to the households living in this economy conversely it is detrimental to foreigners further a sensitivity analysis shows that if the gains losses to implementing monetary union are qualitatively robust when facing changes in the degree of nominal rigidities and the elasticity of substitution between foreign and domestic goods they are quite sensitive to the degree of pricing to market in the economy

trade deflection and trade depression this is the first paper to empirically examine whether a country s use of an import restricting trade policy distorts a foreign country s exports to third markets we first develop a theoretical model of worldwide trade in which the imposition of antidumping and safeguard taris or trade remedies by one country causes significant distortions in world trade flows we then empirically test this model by investigating the eect of the united states use of such import restrictions on japanese exports of roughly 4800 products into 37 countries between 1992 and 2001 our estimation yields evidence that us restrictions both deflect and depress japanese export flows to third countries imposition of a us antidumping measure against japan deflects trade as the average antidumping duty on japanese exports leads to a 5 7 increase in japanese exports of the same product to the average third country market the imposition of a us antidumping measure against a third country depresses trade as the average us duty imposed on a third country leads to a 5 19 decrease in japanese exports of that same product to the average third country s market we also document the substantial variation in trade deflection and trade depression across dierent importing countries and exported products

dumping and dynamic competition abstract when the current output level affects future production costs domestic and foreign profit maximizing firms may set prices below current costs to gain experience antidumping enforcement which poses a barrier to below cost sales by foreign rivals changes the payoff structure of competition and alters the equilibrium decisions of both foreign and domestic firms a comparison of the nash equilibria with and without antidumping rules shows that these rules change market outcomes even when they do not appear to be binding ex post this positive analysis of antidumping enforcement complements previous studies that have considered the motivation for dumping

purchasing power parity over two centuries abstract this paper re examines the purchasing power parity hypothesis for the dollar sterling exchange rate using the two centuries of data from lothian and taylor lt 1996 real exchange rate behavior the recent float from the perspective of the past two centuries journal of political economy 104 3 488 509 unlike lt we conclude that the dollar sterling rer is nonstationary implying a rejection of the long run ppp hypothesis the differences in our conclusions are explained by 1 sensitivity of adf unit root tests to the choice of lag length and or 2 the presence of significant time trends in the adf or phillips perron unit root test equations

international fish trade and exchange rates an application to the trade with salmon and fishmeal international fish trade is growing and fish exports represent an important source of foreign currency for many countries for a few countries the exports are also an essential part of the economy we revisit the seminal paper of richardson 1978 that addresses the issue of exchange rate pass through in commodity markets but in a multivariate cointegration framework the multivariate cointegration framework allows us to test common assumptions like exchange rate pass through leading price central markets and exogeneity of exchange rates this approach is particularly suited when studying markets for primary products we provide empirical examples using salmon imports to japan and fish meal exports from peru to germany

risk uncertainty and exchange rates this paper is motivated by two facts failure of log linear empirical exchange rate models of the 1970 s and the observed variability of risk premiums in the forward market rational maximizing models predict that changes in conditional variances of monetary policies government spendings and income growths affect risk premiums and induce conditional volatility of exchange rates i examine theoretically how changes in these exogenous conditional variances affect the level of the current exchange rate and attempt to quantify the extent that this channel explains exchange rate volatility using autoregressive conditional heteroscedastic models

the effects of industry structure on economic exposure abstract a firm is subject to economic exposure if changes in exchange rates affect the firm s value as measured by the present value of its future cash flows this paper shows that in many forms of competition including the most commonly studied case of monopoly the economic exposure of an exporting firm is simply proportional to the firm s net revenues based in foreign currency this simple result breaks down under some but not all forms of competition between the exporting firm and foreign firms in that case the exporting firm needs to know about the price elasticity of its product demand and its marginal cost in order to assess its exposure to exchange rates the key determinant of economic exposure therefore is the competitive structure of the industry in which a firm operates

the chilling trade effects of antidumping proliferation advocates of antidumping ad laws downplay their negative effects by arguing that the trade flows that are subject to ad are small and their distortions negligible but while the adverse effect of ad on product level trade has long been established the question remains whether there are trade effects at the aggregate level the recent proliferation wave of ad laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing ad laws for this purpose we estimate the effect of ad on bilateral trade flows between the new adopters of ad laws and their trade partners using a gravity model of annual observations 1980 2000 our estimates show that ad has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors we find that new tough users experience a chilling of their aggregate imports of 14 billion us a year or 5 9 as a result of ad measures for some countries like mexico and india the dampening effects of ad laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization

exchange rate effects on the volume and variability of trade flows abstract this paper investigates the effects of exchange rate uncertainty on the volume and variability of trade flows employing a signal extraction framework we show that the direction and magnitude of importers and exporters optimal trading activities depend upon the source of the uncertainty general microstructure shocks fundamental factors driving the exchange rate process or a noisy signal of policy innovations providing a rationale for the contradictory empirical evidence in the literature we also show that exchange rate uncertainty emanating from general microstructure shocks and the fundamental factors reduces the variability of trade flows while that related to a noisy signal of policy innovations increases variability

the first review of european union antidumping reviews the literature on antidumping ad has documented various aspects of this protectionist tool however a peculiar feature of ad has not received much attention these measures are endogenous to the behaviour of the exporting firms which can adjust the dumping margin by changing their export price and ask the authority to amend the ad measures accordingly the objective of this paper is to fill part of this gap in the literature by analysing the ad reviews conducted by the european union for affirmative petitions initiated in 1980 2009 to this end a novel data set of all such reviews has been assembled summary statistics reveal that more than a third of all petitions concluded with the imposition of ad measures are reviewed at least once before their expiration and most reviews lead to lower ad duties although almost 20 per cent of the firms investigated through interim reviews see their duties increase there are significant differences in the outcome of the reviews depending on the party requesting them i e reviews lodged by european producers are less likely to lead to lower duties these conclusions are confirmed by the econometric analysis which also shows that chinese firms see their duties reduced significantly less than those of firms from other countries

how should public pension plans invest how public pension plan assets should be invested is an important but unsettled question alicia h munnell and mauricio soto 2007 find that the share of state and local s l plan assets held in equities has grown over time largely in parallel with private sector practices from an average of about 40 percent in the late 1980s to about 70 percent in 2007 this exposure led to a loss of an estimated 1 trillion dollars following the decline of the stock market from october 2007 to october 2008 munnell kelly haverstick and jean pierre aubry 2008 nevertheless some observers endorse the standard practice of investing heavily in higher yielding but riskier equities reasoning that the higher average returns will reduce future required tax receipts and also help to reduce underfunding over time others advocate a more conservative approach that reduces the volatility of funding levels and the likelihood of severe shortfalls during economic downturns when government resources are already constrained e g lawrence n bader and jeremy gold 2007 the accounting rules for public pensions create a perverse incentive to invest in stocks since projected liabilities are discounted at the expected return on assets rather than at a rate that reflects the generally lower risk of liabilities investing the assets in the stock market leads to

the effects of real exchange rate risk on international trade abstract by assuming real profit maximization and uncertain prices as well as exchange rates we conclude that it is uncertain percentage changes in the real exchange rate that are risky in international trade empirical estimation of fourteen bilateral trade flows among industrialized countries finds a significant negative effect on trade quantity from such risk in a number of these cases the expectation variable has a positive effect in a larger number of cases significant price effects from the expectation variable are fewer and from risk are negligible

tailwinds from the east how has the rising share of imports from emerging markets affected import prices this paper quantifies the effect of the rising share of imports from emerging market economies emes on import price inflation in the uk using a panel regression approach that accounts for heterogeneity across industries we estimate that between 1999 and 2011 the rise in china s import share of manufactured goods lowered uk import price inflation by around 0 5 percentage points per year we call this the tailwind rising imports from other eme country groups are not found to have any significant impact our approach allows us to decompose this effect two thirds arises from the direct impact of switching to lower cost chinese goods the remaining third comes from other exporters lowering their prices in response to stronger competition from china we find no evidence that higher inflation rates in emes has so far reduced or reversed the sign of this tailwind

trade diversion from tomato suspension agreements trade barriers can cause output to be diverted to other countries and into other products we study the effect of a voluntary price restraint vpr on mexican tomatoes entering the united states the diversion caused by the vpr is statistically and economically significant representing over four fifths of the direct effects of the trade barrier when the vpr was binding mexico exported more tomatoes to canada the united states cut back on exports while canada increased their exports to the united states the vpr also diverted fresh tomatoes in mexico into paste production which was then exported to the united states des barrieres commerciales peuvent entrainer la diversion de l output vers d autres pays ou d autres productions on etudie la diversion causee par les accords de restriction volontaire des prix arvp des tomates mexicaines entrant sur le marche americain la diversion causee par les arvp a ete statistiquement et economiquement significative representant plus des quatre cinquiemes des effets directs de la barriere tarifaire quand les arvp ont ete contraignants le mexique a exporte plus de tomates au canada les etats unis ont reduit leurs exportations alors que le canada augmentait ses exportations vers les etats unis les arvp ont aussi entraine une diversion des tomates fraiches au mexique vers la production de puree de tomate un produit qui a alors ete exporte vers les etats unis

pass through of exchange rates and purchasing power parity abstract in this paper we develop and test two hypotheses about purchasing power parity ppp the first is that changes in the price of traded goods relative to domestic substitutes will affect the ppp relation due to the partial pass through of exchange rates the second is that ppp should hold on forward rather than spot exchange rates due to hedging by firms which implies that the interest rate differential should enter the ppp relation for spot rates using quarterly data for several countries we find support for both these hypotheses though the magnitude of the interest rate effect is very small

pricing to market in european automobile exports to oecd countries a panel data approach this paper investigates pricing to market behaviour using data for european auto exports the empirical analysis uses forward instead of spot exchange rates cross country and cross product analyses reveal that pricing behaviour depends mainly on the class of product while the country of origin and destination appears as less important furthermore the data do not usually reject the hypothesis of a symmetric response of export prices to depreciations and appreciations of the exporter s currency finally although the point estimates confirm the combined influence of the business cycle and the direction of the exchange rate movements on pricing to market in most cases formal tests seldom provide statistical significance for this result

cointegration tests of purchasing power parity the case of swiss exchange rates abstract this paper tests purchasing power parity ppp as a long run equilibrium condition by examining the long run relationshiop between exchange rates and wholesale price indices using cointegration tests this paper avoids some of the problems of previous cointegration tests of ppp by using more precise data pretests and by not imposing a priori restrictions upon the cointegrating vector of the nine combinations of swiss exchange rates and price indices examined cointegration is detected in seven cases thus supporting ppp as a long run equilibrium jel f31 c32

antidumping investigations and the pass through of antidumping duties and exchange rates comment well in excess of 100 percent based on their understanding of the us antidumping calculation however the hypothesis is based on an incorrect understanding of the antidumping calculation under us law when corrected for this error the hypothesis would lead to a prediction of simple 100 percent pass through at most dumping refers to selling a product in an export market at less than its normal value a benchmark that is most commonly based on sales in the domestic market of the same product antidumping laws set tariffs to offset the amount of dumping the excess of normal value over export price in us practice a dumping complaint is brought on behalf of an industry against rival imports with the cases defined by product and by country a successful case results in the potential imposition of antidumping duties over and above any normal tariffs an unsuccessful case results in no duties being imposed american antidumping law and practice have the somewhat unusual characteristic that anti dumping duties are estimated and used to set duty deposits for a forward looking period in an initial investigation then are recalculated and actually assessed for the same period now back ward looking in a later review with some variation the later review is typically completed about two years after the initial investigation the review sets a new deposit rate and a second review determines the actual assessment rate retrospectively this can be repeated indefinitely the ini tial duty estimate resulting in a deposit rate allows companies to modify their pricing behavior so as to affect the actual dumping duties that are later assessed blonigen and haynes exploit this characteristic of the us administration of its antidump ing law to examine the effects of the imposition of antidumping duties on the pass through to us pricing the dumping investigation and resulting deposit rate provide information that the company can use in its subsequent sales in order to reduce or eliminate its dumping liability in the eventual review by comparing the antidumping deposit rates with eventual us pricing the degree of pass through of antidumping deposits can be estimated and the effects on exchange rate pass through of a potential antidumping dumping duty can be studied here i focus on the factual underpinnings that lead to blonigen and haynes s pricing model rather than the empirical results that model predicts that the method by which the us department of commerce usdoc calculates ad duties will lead to pass through of estimated antidump ing duties at twice the level of those estimated duties if companies wish to eliminate the eventual dumping duties by studying the outcomes of a series of ad cases concerning steel from canada they conclude that pass through of estimated duties exceeds 160 percent broadly consistent with

anti dumping and countervailing duties under oligopoly abstract this paper constructs a conjectural variations model of international oligopoly in which the home country s optimal policy responses to the foreign government s subsidies and foreign firms dumping can be calculated some theoretical support is found for tariffs that countervail part of the foreign export subsidy the optimal fraction depends on the size of own and cross effects in demand and on the extent of market competition however no normative case is found for anti dumping duties

the effect of domestic antidumping law in the presence of foreign monopoly abstract we analyze the effects of antidumping law when utilized by competitive domestic petitioners against a foreign monopolist the monopolist reduces the cost of holding excess capacity in periods of slack foreign demand by dumping on the domestic market antidumping law reduces trade volume both directly under successful petitions and indirectly when no petition is filed by causing the monopolist to alter its capacity and the allocation of that capacity between markets finally we consider the effects of self enforcing agreements in which the domestic industry agrees not to file in exchange for a promise that the foreign monopolist limit exports

the impact of surplus sharing on the portfolio mix of public sector defined benefit pension plans a public choice approach the riskiness of state employee pension plan portfolios varies across states we investigate whether this variation is related to how public employees and taxpayers share actuarial surpluses of pension accounts we focus on two determinants of a plan s asset mix the relative influence of public employees to taxpayers and whether a surplus sharing contract is specified our theoretical model demonstrates that the effect of public employee influence on the asset mix is ambiguous our empirical results corroborate this complex theoretical result in our theoretical and empirical analyses if a surplus sharing rule is specified plans adopt a more aggressive investment allocation

trade diversion as firm adjustment to trade policy evidence from eu anti dumping duties on vietnamese footwear this paper evaluates the impact of the 2006 european union anti dumping ad action on vietnamese footwear in three markets imports to the eu footwear producers in vietnam and the trade diversionary adjustment of vietnamese firms in the us market we find that the ad action reduced vietnamese imports to the eu by as much as 65 per cent given that the eu makes up almost two thirds of vietnam s footwear exports and footwear is among the top four export industries for vietnam this reduction is economically significant consistent with predictions of our model we find evidence of trade diversion by vietnamese producers from the eu to the us market our difference in difference estimates of the ad actions on the value of vietnamese footwear imports to the united states ranged from 69 to 71 per cent over the period 2004 07 and 69 to 72 per cent in terms of quantity these results highlight the spillover effects of trade policy in third markets when firms adjust to trade barriers our results are robust to triple difference specifications where we adjust for trend differences and a series of placebo specifications

dynamic information spillovers in intraregionally focused spot and forward currency markets abstract this paper proposes an intraregionally focused tri currency modeling framework to investigate dynamic information spillovers across spot and forward exchange rate markets in frontier and emerging country currencies for both price levels and volatilities empirical estimates of structural parameters were obtained using an mgarch mskst model that incorporated the term structure of non deliverable forward ndf and deliverable forward df markets the dominance of regional currencies and the influence of differing forward contract maturities 1 3 6 and 12 months the currencies for nine countries were grouped into three regions northeast asia china korea and taiwan south southeast asia india indonesia and philippines and latin america brazil chile and columbia the currency for each selected country was evaluated within the regionally determined tri currency system we found that ndf markets play a dominant role over df markets with regard to price discovery during periods of tranquility during periods of crisis both ndf and df markets exhibit a more balanced impact on currency market price discovery mechanisms in addition distinct differences were observed across regions currencies in northeast asia were shown to be affected by the chinese renminbi during periods of crisis and the indian rupee could be regarded as the dominant currency in south southeast asia no robust results were obtained with regard to the dominance of currencies in latin america finally our results also suggest important distinctions between the effect of various instrument maturities on ndf and df market returns with df returns being more responsive to longer maturities 6 months and 12 months during tranquil periods ndf returns are more responsive to shorter maturities but during crisis periods this effect is diminished

exchange rates and traded goods prices abstract this paper presents a partial equilibrium model of the determination of domestic and export prices by a monopolistic competitive firm the model stresses the role of exchange rate uncertainty and expectations the most important result of the analysis is that the stochastic properties of deviations from the law of one price are crucially affected by the currency of denomination of export prices using data on domestic and dollar export prices of japanese goods i find that deviations from the law of one price are due to exchange rate surprises but also to price staggering and ex ante price discrimination

how bad is antidumping evidence from panel data abstract current research on antidumping suggests a number of channels through which antidumping affects the volume of world trade this paper uses a structural approach to the gravity model framework to evaluate these hypotheses using data on trade volume over the period 1948 to 2001 we conclude that the volume and welfare effects have been negative but quite modest

china s export growth and the china safeguard threats to the world trading system is there evidence from china s pre wto accession period that newly imposed u s or eu import restrictions deflect chinese exports to third markets the authors examine this question by drawing on a newly constructed data set of u s and eu product level import restrictions on chinese trade imposed between 1992 and 2001 and estimate their impact on chinese exports to 38 alternative markets there is no systematic evidence that the import restrictions imposed during this period resulted in chinese exports surging to such alternate destinations to the contrary there is weak evidence of a chilling effect on china s exports to third markets

long run purchasing power parity during the recent float abstract this paper examines the relevance of long run purchasing power parity ppp which allows for measurement errors during the recent floating exchange rate period previous empirical studies generally fail to find support for long run ppp over this period in this paper in this paper the cointegration property of exchange rates and prices is examined using maximum likelihood procedure and we find significant evidence favorable to long run ppp further tests for symmetry and proportionality indicate that these two conditions are not generally with the data the results support the hypothesis of long run ppp with measurement errors in prices

international financial volatility and commodity exports evidence from the thai agricultural sector using 1981 2006 data from the bank of thailand i estimate the effect of four measures of real exchange rate volatility on thai exports of five key agricultural commodities controlling for both the level of the real exchange rate and foreign incomes estimates of the effect of volatility on export volume are generally negative and often significant lending support to a range of theoretical models that predict such an effect no such relationship exists between lagged values of exchange rate volatility and agricultural production the range of results obtained using various measures of volatility suggests caution in comparing studies using different measures copyright 2010 oxford university press

foreign subsidization and excess capacity abstract the u s steel industry has long held that foreign subsidization and excess capacity has led to its long run demise yet no one has formally examined this hypothesis in this paper we incorporate foreign subsidization considerations into a model based on staiger and wolak s 1992 cyclical dumping framework and illustrate testable implications of both cyclical excess capacity and structural excess capacity stemming from foreign subsidization we then use detailed product and foreign country level data on steel exports to the u s market to estimate these excess capacity effects while the full sample results provide evidence of both cyclical and structural excess capacity effects for exports to the u s market these effects are confined to such a narrow range of country product combinations that it is unlikely that such effects were a significant factor in the fortunes of u s steel firms over the past decades

the impact of yuan internationalization on the stability of the international monetary system we study the implication of yuan internationalization on the stability of the international monetary system more specifically we use a three country three currency portfolio model to analyze the impact of yuan internationalization on exchange rates in the event of trade shocks with stock flow adjustment of the net foreign asset positions we show that the internationalization of the yuan would lessen the response of floating exchange rates to asymmetric trade shocks as well as attenuate the distortionary impact of china keeping its currency pegged to the dollar conversely yuan internationalization would amplify the impact of trade shocks on net foreign asset positions albeit to a limited extent

in which currency should exporters set their prices this paper studies the choice of price setting currency for an exporter faced with the choice of setting price in his own in the importers or a third currency under exchange rate uncertainty we establish that sufficient conditions on demand and cost functions for exchange rate pass through to be less than unity under certainty are also sufficient conditions for price setting in the importer s currency to yield the highest expected profit under exchange rate uncertainty under the same conditions on demand and cost functions setting price in the importer s currency maximizes expected utility when risk aversion and forward currency markets are introduced

export price responses to exogenous exchange rate movements the export price responses to three different exogenous exchange rate movements are investigated using data on swedish exports of automobiles and kraft paper to three destination countries a pric

uncertainty and export performance evidence from 18 countries 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

proposed gasb rules show why only market valuation fully captures public pension liabilities the governmental accounting standards board has released preliminary views on how public sector pension plans should value benefit liabilities because the gasb s proposals ignore government s contingent liability to pay plan benefits should assets fall short they omit the full value of plan liabilities and contradict the gasb s own standard of interperiod equity

the impact of real exchange rate flexibility on east asian exports this paper estimates the impact of intra regiona l real exchange rate flexibility on east asian exports the hypothesis is that t he impact would be negative for east asian countries regardless of their exchange

equivalence results for optimal pass through optimal indexing to exchange rates and optimal choice of currency for export pricing firms sometimes write price lists or catalogs for their exports so they set prices for a period of time and do not adjust prices during that interval in response to changes in their environment the firm sets the price either in its own currency or the importer s currency this paper draws a simple link between the choice of currency and the pricing decision of a firm that changes prices in response to all shocks specifically if the latter firm s price has a lower variance in terms of its own currency than the importer s currency then the firm with a price list will set the price in its own currency and otherwise it will set price in the foreign currency this relationship is established by consideration of the firm with a price list as a special case of a firm that indexes its export price to the exchange rate jel f4 f1

international comparisons of pricing to market behavior this paper measures the degree of price discrimination across export destinations that is associated with exchange rate changes using u s u k german and japanese industry level data given the industries sampled more price discrimination across destinations is observed in the u k german and japanese data for industries that match across source countries however behavior is very similar across source countries furthermore destination specific price adjustment on exports to the united states from germany and japan is similar to price adjustment observed on shipments to other destinations most variation in the data appears to be related to industry copyright 1993 by american economic association