THE ASYMMETRIC EFFECTS OF EXCHANGE RATE VOLATILITY ON INTERNATIONAL TRADE IN A TRANSITION ECONOMY: THE CASE OF VIETNAM

Loc Dong Truong (), Ha Hoang Ngoc Le and Dut Van Vo
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Loc Dong Truong: Can Tho University, Vietnam
Ha Hoang Ngoc Le: Can Tho University, Vietnam
Dut Van Vo: Can Tho University, Vietnam

Bulletin of Monetary Economics and Banking, 2022, vol. 25, issue 2, 203-214

Abstract: This study examines the asymmetric effects of Exchange Rate Volatility (ERV) on Vietnam’s international trade. Using time-series data fitted to the Nonlinear Autoregressive Distributed Lag (NARDL) model, we find that positive changes in ERV have a negative impact on the trade balance in the short-run. On the other hand, increases in ERV have a positive impact on the trade balance in the long-run. We also find that negative changes in ERV do not have any significant effect on the trade balance.

Keywords: Exchange rate volatility; Trade flows; NARDL; Vietnam (search for similar items in EconPapers)
JEL-codes: F14 F31 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:25:y:2022:i:2d:p:203-214

DOI: 10.21098/bemp.v25i2.1636

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