The Short- and Long-Run Effects of Exchange Rate Changes on the Japanese Electronics Industry

Willem Thorbecke

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: The value of Japanese electronics exports has tumbled since the advent of the Global Financial Crisis, largely because export prices have fallen. This paper presents evidence that the appreciation of the yen between 2007 and 2011 caused yen export prices for electronics goods to fall by more than 20%. Yen export prices fell much more then yen costs over this period, implying that profit margins have been squeezed. This paper also reports that, in the long run, a 10% appreciation of the yen will reduce the volume of electronics exports by 10%. Japanese firms could mitigate the adverse impact of the strong yen by producing innovative products rather than competing based on price in commoditized industries.

Pages: 34 pages
Date: 2012-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
https://www.rieti.go.jp/jp/publications/dp/12e019.pdf (application/pdf)

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:eti:dpaper:12019

Access Statistics for this paper

More papers in Discussion papers from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().