Exchange Rates, Foreign Income, and U.S. Agriculture

Mathew Shane, Terry Roe and Agapi Somwaru

No 6686, Conference Papers from University of Minnesota, Center for International Food and Agricultural Policy

Abstract: This paper focuses on estimating the effects of trade partner income and real trade-weighted exchange rates on US agricultural exports. For the period 1970-2003, a one percent annual increase in trade partners’ income is found to increase total agricultural exports by about 1.6 percent while a one percent appreciation of the dollar relative to trade partner trade-weighted currencies decreases total agricultural exports by about 0.8 percent. We find these effects also carry over to 12 commodity subcategories, although the effects are conditioned by differences between bulk and high value commodities, and differences in the export demand from high compared to low income countries. We also find that the negative effect of exchange rate appreciation on exports often dominates the positive effect from income growth.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 23
Date: 2006-08
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Exchange Rates, Foreign Income and U.S. Agriculture (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:umcicp:6686

DOI: 10.22004/ag.econ.6686

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