Exchange Rate Volatility and Grain Trade: A Gravity Model Analysis at the Sectoral Level
No hay miniatura disponible
Fecha
Autores
Título de la revista
ISSN de la revista
Título del volumen
Editor
Resumen
Descripción
There has been a controversy among economists on whether exchange rate volatility has a negative effect on trade. We will investigate this issue by making use of a sectoral gravity model of global grain trade. Our identification strategy carefully addresses endogeneity issues present in earlier studies. Using a long panel, we are able to show that exchange rate volatility has a negative impact on bilateral export trade flows. The magnitude of this effect can vary widely, depending on the market under study, which is an indicator for substantial heterogeneity among sectors.