Analyzing the Effect of Real Exchange Rate on Petrochemicals Exporting

Majid Delavari, Naghmeh Baranpour and Abbas Abdeshahi

MPRA Paper from University Library of Munich, Germany

Abstract: The export of petrochemical products -as a type of non-oil export- plays a key role in the economic development of our country. This is of special importance in light of the structure of Iran's economy that is oil-based. Identifying the factors affecting the export of petrochemical products can improve their export. Using Johansen-Juselius co-integration method and the error correction model, the present study purports to investigate the effects of the real foreign exchange rate and the total value of petrochemical products on the export of these products in Iran. This research used data from 1989 to 2012. It was found that the real foreign exchange rate and the real value of total petrochemical products positively affect their export in the long run, and the effect of the former is greater than that of the latter. However, in the short run the effect of the foreign exchange rate on the export of petrochemical products is more significant.

Keywords: Real Exchange Rate; Non-Oil Exporting; Petrochemicals; Johansen-Juselius Method; ECM Model. (search for similar items in EconPapers)
JEL-codes: C22 C65 Q42 Q43 (search for similar items in EconPapers)
Date: 2014-11-30
New Economics Papers: this item is included in nep-ara, nep-ene and nep-opm
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