Macroeconomic impacts of Chinese currency appreciation on China and the Rest of World: A global CGE analysis

Jun Yang, Wei Zhang and Simla Tokgoz

Journal of Policy Modeling, 2013, vol. 35, issue 6, 1029-1042

Abstract: This paper analyzes the ex-ante short-term impacts of the Chinese RMB appreciation on the Chinese and world economy, using a novel approach of modeling nominal exchange rate adjustment in the GTAP, a global CGE model. Scenario results show that Chinese economy will be affected negatively, with lower real GDP, lower employment rates, and a decline in the trade surplus. Chinese currency appreciation has positive impact on the GDP of the major countries and regions, although by a small margin. With higher Chinese exchange rate, trade balance for other trading partner countries improves with the exception of the U.S.

Keywords: Exchange rate; Economic impacts; General equilibrium model (search for similar items in EconPapers)
JEL-codes: F13 O24 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:35:y:2013:i:6:p:1029-1042

DOI: 10.1016/j.jpolmod.2013.07.003

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