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Title: |
The Effects of Exchange Rate Volatility on U.S. Imports: An Empirical
Investigation |
| Author: |
Arize, A. C. |
| Author
Affiliation: |
TX A&M U |
| Source: |
International Economic Journal, Autumn 1998, v. 12, no. 3, pp. 31-40 |
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Publication Date: |
Autumn 1998 |
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Abstract: |
In this paper we obtain and interpret new
estimates of the short- and long-run influence of exchange-rate
volatility (or risk) on the import flows of the United States, in the
generalized floating exchange-rate period. The major finding is that
there is a significant long-run negative effect of exchange-rate
volatility on the volume of imports, as well as, a significant short-run
negative effect. Therefore, it can be argued that exchange-rate
volatility will have significant effects on the allocation of resources
by market participants and that policy-makers can no longer rely on an
import demand with only conventional variables for long-term
international trade planning, forecasting and policy formulation. |
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