Depreciations without Exports?

This paper analyzes how the exchange rate elasticity of exports has changed over time and across countries and sectors, and how the formation of global value chains has affected this relationship. The analysis uses a panel framework covering 46 countries over the period 1996-2012, and first finds evidence that the elasticity of manufacturing export volumes to the real effective exchange rate has decreased over time. The paper then examines whether the formation of supply chains has affected this elasticity using different measures of global value chain integration. Intuitively, as countries are more integrated in global production processes, a currency depreciation only improves the competitiveness of a fraction of the value of final goods exports. In line with this intuition, the analysis finds evidence that the rise of participation in global value chains explains on average 40 percent of the fall in the elasticity, and that corrections of the real effective exchange rate for participation in global value chains do not present the same decreasing pattern in elasticity.

Bibliographic Details

Main Authors:	Ahmed, Swarnali, Appendino, Maximiliano, Ruta, Michele
Format:	Working Paper biblioteca
Language:	English en_US
Published:	World Bank, Washington, DC 2015-08
Subjects:	GROWTH RATES, ECONOMIC GROWTH, PRODUCTION, NOMINAL EXCHANGE RATES, FIXED EFFECT, COUNTRY FIXED EFFECTS, DEPRECIATION, CONSUMER PRICE INDICES, REAL EXCHANGE RATES, IMPORT, TRADE BARRIERS, EXCHANGE, REAL GDP, CHANGES IN TRADE, GDP PER CAPITA, EXPORTS, ELASTICITY OF EXPORTS, ELASTICITY, TRADE FLOWS, RECESSION, EXPORTERS, PRICE INDICES, WORLD DEVELOPMENT INDICATORS, MACROECONOMIC CONDITIONS, VARIABLES, SLOWDOWN, INPUTS, DUMPING, REAL EXCHANGE RATE, ECONOMIC OUTLOOK, FINAL GOODS, IMPORT CONTENT, REAL EFFECTIVE EXCHANGE RATE, EFFECTIVE EXCHANGE RATE, GROSS EXPORTS, INFLUENCE, REAL DEPRECIATION, ABSOLUTE VALUE, CURRENCY, DEVELOPMENT ECONOMICS, EXPORT GROWTH, EXCHANGE RATE MOVEMENTS, TRADE INTEGRATION, VALUE‐ADDED, INCOME GROWTH, REAL EFFECTIVE EXCHANGE RATES, EXCHANGE RATES, COUNTRY FIXED EFFECT, MACROECONOMIC MODELS, FOREIGN FIRMS, CURRENCY DEPRECIATIONS, IMPORT PROTECTION, REAL EXCHANGE RATE CHANGE, WTO, DEPRECIATIONS, BUSINESS CYCLE, ACCESS, INTERNATIONAL ECONOMICS, TRADE POLICY, RATE MOVEMENTS, TRADE POLICIES, ECONOMIC RESEARCH, VALUE ADDED, KNOWLEDGE SPILLOVERS, EXTERNAL DEMAND, TOTAL EXPORTS, DEFLATORS, INTERNATIONAL TRADE, TRADE RESTRICTIVENESS, FINANCIAL CRISIS, VALUE, DEPENDENT VARIABLE, COMPETITIVENESS, TRADE GROWTH, CREDIT, FORMAL ANALYSIS, MACROECONOMICS, DEMAND, EXPORT SHARES, INTERMEDIATE GOODS, ECONOMY, CONSUMERS, LOCAL CURRENCY, REAL EXPORTS, FIXED EFFECTS, BUSINESS CYCLES, TRADE DATA, TRADE, CURRENCY DEPRECIATION, USE VALUE, GDP, GOODS, THEORY, GLOBAL TRADE, REAL DEPRECIATIONS, REAL EXPORT GROWTH, EFFECTIVE EXCHANGE RATES, SUPPLY, TRADE RELATIONS, GLOBAL DEMAND, EXPORT VOLUMES, PRICE COMPETITIVENESS, WORLD TRADE, REVALUATION, ECONOMIC HISTORY, CYCLICAL FACTORS, EXCHANGE RATE, BUSINESS CYCLE SYNCHRONIZATION, INTERMEDIATE INPUTS, TRADING PARTNERS, MEASURES OF INTEGRATION, REAL EXPORT, MACROECONOMIC ADJUSTMENT, REAL EXCHANGE RATE CHANGES, ECONOMIES, DEVELOPMENT POLICY, TOTAL EXPORT, FUTURE RESEARCH,
Online Access:	http://documents.worldbank.org/curated/en/2015/08/24895630/depreciations-without-exports-global-value-chains-exchange-rate-elasticity-exports https://hdl.handle.net/10986/22440
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