Test of the J-curve for six selected new EU countries

Yu Hsing

International Journal of Economic Policy in Emerging Economies, 2009, vol. 2, issue 1, 76-85

Abstract: This paper examines the J-curve for the bilateral trade between Croatia, the Czech Republic, Hungary, Poland, Slovakia, or Slovenia and the USA. This paper finds that the J-curve is not empirically confirmed for any of these six countries. Instead, after a shock to real depreciation, the trade balance improves for the Czech Republic, deteriorates for Hungary, Poland, Slovakia, and Slovenia, and improves first and then deteriorates for Croatia. Estimated cointegrating equations show that except for the Czech Republic, real depreciation deteriorates the trade balance for the other five countries in the long run.

Keywords: J-curve; real depreciation; trade balance; generalised impulse response function; European Union; EU; Croatia, the Czech Republic, Hungary; Poland; Slovakia; Slovenia; United States; USA; bilateral trade; economic policy; emerging economies. (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijepee:v:2:y:2009:i:1:p:76-85

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