S-Curve Dynamics of Trade: Evidence from US-Canada Commodity Trade

Mohsen Bahmani-Oskooee and Artatrana Ratha ()

Economic Issues Journal Articles, 2009, vol. 14, issue 1, 1-16

Abstract: The J-Curve effect is a concept used to describe the short-run effects of currency depreciation on the trade balance, i.e., an initial deterioration of the trade balance followed by an improvement. A concept close to the J-Curve is the S-Curve introduced by Backus, et al (1994) who found that the cross-correlation function between current terms of trade and future values of the trade balance is positive, but between current terms of trade and past values of the trade balance it is negative. The S-curve, however, did not receive strong support in the cases of Canada and the US Suspecting that the lack of an S-Curve pattern for each of the two countries could be to the result of using aggregate trade data, we disaggregate the trade data between the two countries by commodity and provide overwhelming support for the S-Curve in 41 out of 60 industries, that account for more than 80 per cent of the bilateral trade between the two countries.

Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://www.economicissues.org.uk/Files/109Bahmani-Oskooee.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eis:articl:109bahmani

Access Statistics for this article

More articles in Economic Issues Journal Articles from Economic Issues Contact information at EDIRC.
Bibliographic data for series maintained by Dan Wheatley ().