 Exchange rate volatility and commodity trade between United States and Australia: An asymmetric analysisMohsen Bahmani‐Oskooee and
Hanafiah Harvey
The World Economy, 2021, vol. 44, issue 6, 1509-1700 Abstract: Previous studies that assessed the impact of exchange rate volatility on Australian trade flows assumed that the effects are symmetric, meaning that if an x% increase in volatility hurts trade flows by y%, an x% decreased in volatility, boosts trade flows by y%. The new direction in the literature is to engage in asymmetric analysis, since the rate at which trade flows respond to increased volatility could be different than the rate at which they response to declines. We do this by assessing the symmetric and asymmetric effects of the Australian dollar–U.S. dollar exchange rate volatility on the exports of 230 U.S. exporting industries to Australia and 129 Australian exporting industries to the United States. We find overwhelming support for short‐run and long‐run asymmetric effects of exchange rate volatility on both countries exports to each other. A few large industries that were not found to be affected by volatility symmetrically, they were found to be affected asymmetrically. Date: 2021 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:worlde:v:44:y:2021:i:6:p:1509-1700 Ordering information: This journal article can be ordered from Access Statistics for this article The World Economy is currently edited by David Greenaway More articles in The World Economy from Wiley Blackwell |
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