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US Cotton Exports and Bilateral Exchange Rates

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  • Durmaz, Nazif
  • Thompson, Henry

Abstract

This paper compares the sensitivity of US cotton exports to the bilateral exchange rate for three Asian textile producers with a long series of yearly data from 1978 to 2010. The model of the cotton market includes an alternate supply, US production cost, and local mill use. Effects of each bilateral exchange rate vary considerably across these countries. Aggregation and the related trade weighted exchange rate lead to misleading results. Changes in the rate of depreciation have more robust effects than depreciation, suggesting a wealth effect on cash balance.

Suggested Citation

  • Durmaz, Nazif & Thompson, Henry, 2013. "US Cotton Exports and Bilateral Exchange Rates," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 14(1), pages 1-11.
    • Handle: RePEc:ags:aergaa:253534
    DOI: 10.22004/ag.econ.253534
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    References listed on IDEAS

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    1. Shane, Mathew & Roe, Terry L. & Somwaru, Agapi, 2008. "Exchange Rates, Foreign Income, and U.S. Agricultural Exports," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 37(2), pages 1-16.
    2. Bayard, Budry & Chen, Lijun & Thompson, Henry, 2009. "Free Trade and a Case of Local Tomato Production," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 8(2).
    3. Jolly, Curtis M. & Jefferson-Moore, Kenrett Y. & Traxler, Greg, 2005. "Consequences of Biotechnology Policy for Competitiveness and Trade of Southern U.S. Agriculture," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 37(2), pages 1-16, August.
    4. G. Edward Schuh, 1974. "The Exchange Rate and U. S. Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(1), pages 1-13.
    5. Titus O. Awokuse & Yan Yuan, 2006. "The impact of exchange rate volatility on U.S. poultry exports," Agribusiness, John Wiley & Sons, Ltd., vol. 22(2), pages 233-245.
    6. Thompson, Henry & Upadhyaya, Kamal P., 1998. "The Impact of the Exchange Rate on Local Industry," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 51(1), pages 101-113.
    7. Almarwani, Abdul & Jolly, Curtis M. & Thompson, Henry, 2007. "Exchange Rates and Commodity Markets: Global Exports of Corn, Cotton, Poultry, and Soybeans," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 8(1), pages 1-10, January.
    8. Copeland, Cassandra & Thompson, Henry, 2008. "Lost protection and wages: Some time series evidence for the US," International Review of Economics & Finance, Elsevier, vol. 17(4), pages 603-606, October.
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    Cited by:

    1. Kwame Asiam Addey & William Nganje, 2023. "The role of the U.S. exchange‐rate equity market volatility on agricultural exports and forecasts," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 71(1), pages 25-47, March.
    2. Nazif Durmaz, 2014. "Inventories of Asian Textile Producers, US Cotton Exports, and the Exchange Rate," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 61(4), pages 397-413, September.

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