Estimation of the J-Curve in China

Jaleel Ahmed and Jing Yang
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Jaleel Ahmed: Economics, Massachusetts Institute of Technology, Montreal, Canada

No 67, Economics Study Area Working Papers from East-West Center, Economics Study Area

Abstract: This paper investigates whether a J-curve can be detected in the time series data on China's bilateral trade with the G-7 countries. It utilizes cointegration and causality tests to ascertain the long-run relatedness, and the short-run dynamics, between the real exchange rate, national income, and the trade balance. There is some evidence that a real depreciation eventually improves the trade balance with some countries. But there is no indication of a negative short-run response which characteristics the J-Curve.

Pages: 22 pages
Date: 2004-03
New Economics Papers: this item is included in nep-ifn, nep-sea and nep-tra
References: View complete reference list from CitEc
Citations: View citations in EconPapers (20)

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