EconPapers    
Economics at your fingertips  
 

Exchange rate volatility and ASEAN-4’s trade flows: is there a third country effect?

Abdorreza Soleymani, Soo Y. Chua () and Abdul Fatah Che Hamat
Additional contact information
Abdorreza Soleymani: Universiti Sains Malaysia
Soo Y. Chua: Universiti Sains Malaysia
Abdul Fatah Che Hamat: Universiti Sains Malaysia

International Economics and Economic Policy, 2017, vol. 14, issue 1, 91-117

Abstract: Abstract This paper investigates the impact of exchange rate volatility on the trade flows among ASEAN-4 countries (Indonesia, Malaysia, Singapore and Thailand) as well as to their five main trading partners. External volatility is included in the models to study the ‘third country’ effect on the trade flows. We employ annual import and export data over the period of 1980–2012. The results from the bounds testing approach to cointegration and error-correction model reveal that the real exchange rate volatility does play a significant role in 15 export and four import models in short-run and long-run. Moreover, in both import and export models, the effects of exchange rate volatility on trade flows are negative rather than positive. Finally, the effects of volatility from the ASEAN-4’s currency/yuan rate dominate the third country effect on the ASEAN-4’s trade.

Keywords: ASEAN; Trade flows; Exchange rates volatility; Cointegration (search for similar items in EconPapers)
JEL-codes: F31 F14 F32 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s10368-015-0328-9 Abstract (text/html)
Access to full text is restricted to subscribers.

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:kap:iecepo:v:14:y:2017:i:1:d:10.1007_s10368-015-0328-9

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10368/PS2

Access Statistics for this article

International Economics and Economic Policy is currently edited by Paul J.J. Welfens, Holger C. Wolf, Christian Pierdzioch and Christian Richter

More articles in International Economics and Economic Policy from Springer
Series data maintained by Sonal Shukla ().

 
Page updated 2018-02-15
Handle: RePEc:kap:iecepo:v:14:y:2017:i:1:d:10.1007_s10368-015-0328-9