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How Responsive are Chinese Exports to Exchange Rate Changes? Evidence from Firm-level Data

Xufei Zhang and Xiaoxuan Liu

Journal of Development Studies, 2012, vol. 48, issue 10, 1489-1504

Abstract: This article examines the impact of exchange rate changes on Chinese firms’ decisions on export market entry and export share. Using a large dataset for Chinese firms in 2000--2006, we find that changes in exchange rate levels play a significant role on both export extensive and intensive margins of Chinese firms. Compared to studies using macro data, our firm-level analysis allows us to control for firm and industry heterogeneity. Firm size and location matter. We do not find a difference between foreign and domestic firms in responding to exchange rate changes. Industry heterogeneity is also found to be important.

Date: 2012
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Citations: View citations in EconPapers (5)

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DOI: 10.1080/00220388.2012.663903

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