Export Sophistication and Trade Elasticities

Willem Thorbecke and Nimesh Salike ()

Journal of Asian Economic Integration, 2020, vol. 2, issue 1, 7-26

Abstract: Abstract Does a country’s export structure impact the way that exchange rates affect trade? Do more sophisticated products exhibit lower demand elasticities? Using panel data for major exporters over the 1992–2016 period and dynamic ordinary least squares techniques, we find that price elasticities are higher for low-technology goods such as textiles and footwear than for high-technology goods such as pharmaceuticals and medical equipment. We also find that elasticities are larger for less advanced countries such as China than for more advanced countries such as Switzerland. We draw policy implications from these findings for countries exposed to safe haven capital flows, for countries facing long-term appreciation pressures and for countries that specialise in low-technology exports. JEL Classification: F14, F10

Keywords: Exchange rate elasticities; export sophistication; panel dynamic OLS; export (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (4)

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Working Paper: Export Sophistication and Trade Elasticities (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jfasei:v:2:y:2020:i:1:p:7-26

DOI: 10.1177/2631684620910276

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