OECD Trade Policy Papers

1816-6873 (en ligne)
Cacher / Voir l'abstract
This series is designed to make available to a wider readership selected trade policy studies prepared for use within the OECD.

NB. No. 1 to No. 139 were released under the previous series title OECD Trade Policy Working Papers.


To What Extent Do Exchange Rates and their Volatility Affect Trade? You or your institution have access to this content

Cliquez pour accéder: 
  • PDF
  • http://www.keepeek.com/Digital-Asset-Management/oecd/trade/to-what-extent-do-exchange-rates-and-their-volatility-affect-trade_5kg3slm7b8hg-en
  • LIRE
Marilyne Huchet-Bourdon1, Jane Korinek
Author Affiliations
  • 1: AgroCampus Ouest, Rennes, France

10 oct 2011
Bibliographic information
Pages :

Cacher / Voir l'abstract

Trade deficits and surpluses are sometimes attributed to intentionally low or high exchange rate levels. The impact of exchange rate levels on trade has been much debated but the large body of existing empirical literature does not suggest an unequivocally clear picture of the trade impacts of changes in exchange rates. The impact of exchange rate volatility on trade also does not benefit from a clear theoretical cause-effect relationship. This study examines the impact of exchange rates and their volatility on trade flows in China, the Euro area and the United States in two broadly defined sectors, agriculture on the one hand and manufacturing and mining on the other. It finds that exchange volatility impacts trade flows only slightly. Exchange rate levels, on the other hand, affect trade in both agriculture and manufacturing and mining sectors but do not explain in their entirety the trade imbalances in the three countries examined.
US dollar, volatility, GARCH volatility, long-run effects, real exchange rates, trade, trade in agriculture, exchange rate appreciation, exchange rates, depreciation, currency movements, short-run effects, yuan, euro, trade deficit, exchange hedging
Classification JEL:
  • F01: International Economics / General / Global Outlook
  • F31: International Economics / International Finance / Foreign Exchange
  • O24: Economic Development, Innovation, Technological Change, and Growth / Development Planning and Policy / Trade Policy ; Factor Movement Policy ; Foreign Exchange Policy
  • Q17: Agricultural and Natural Resource Economics ; Environmental and Ecological Economics / Agriculture / Agriculture in International Trade
Visit the OECD web site