Some Further Evidence on Exchange-Rate Volatility and Exports

The relationship between exchange-rate volatility and aggregate export volumes for 12 industrial economies is examined using a model that includes real earnings of oil-producing as determinant industrial-country volumes. A supposition underlying the that, given their levels economic development, oil-exporters’ income elasticities demand exports might differ from those countries. Five estimation techniques, including generalized method moments (GMM) random coefficient (RC) estimation, are employed on panel data covering period 1977:1-2003:4 three measures volatility. In contrast to recent studies employing data, we do not find single instance in which has negative significant impact trade.