The trade balance and the real exchange rate

John K. Hill

Economic and Financial Policy Review, 1990, issue Nov, 15 pages

Abstract: John K. Hill examines how the trade balance and the real exchange rate interact after an economic disturbance. Hill explains how, for disturbances likely to have a significant effect on the trade balance, real exchange rate movements are more the result of a shift in the trade balance than the cause of it. The impetus for change in the trade balance is the disturbance itself. Exchange rate movements are accommodative and, by themselves, account for only part of the total change in the trade balance. Hill concludes that to ask \"How far must the dollar fall to balance the trade account?\" is to seriously overestimate the extent of needed dollar depreciation.

Keywords: Balance of trade; Foreign exchange rates (search for similar items in EconPapers)
Date: 1990
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:fip:fedder:y:1990:i:nov:p:1-15

Ordering information: This journal article can be ordered from

Access Statistics for this article

More articles in Economic and Financial Policy Review from Federal Reserve Bank of Dallas Contact information at EDIRC.
Bibliographic data for series maintained by Amy Chapman ().