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The impact of real exchange rate uncertainty on exports by technology classification in emerging economies

Author

Listed:
  • Ferdi Akpilic

    (Republic of Turkey Ministry of Treasury and Finance)

  • Caglayan Aslan

    (OSTIM Technical University, Republic of Turkey Ministry of Trade)

Abstract

This study examined the relationship between exports grouped by technology classification and movements in the real effective exchange rate for emerging markets. Export demand models were estimated for 24 emerging markets, covering high, medium–high, medium–low, and low technology groups from 2010:Q1 to 2021:Q4. Long-term elasticities were estimated using the Augmented Mean Group (AMG) panel estimator. The results indicate that exchange rate uncertainty negatively impacts exports in medium–high and medium–low technology groups, as well as total exports. Mean Group and Common Correlated Effects Mean Group (CCEMG) estimators broadly support these findings. Country-specific analysis revealed a predominantly negative relationship between real exchange rate uncertainty and exports in countries with significant coefficients. Overall, the study highlights the importance of considering country-specific characteristics and technology classifications when studying the link between exchange rate uncertainty and exports.

Suggested Citation

  • Ferdi Akpilic & Caglayan Aslan, 2024. "The impact of real exchange rate uncertainty on exports by technology classification in emerging economies," International Economics and Economic Policy, Springer, vol. 21(4), pages 907-931, October.
    • Handle: RePEc:kap:iecepo:v:21:y:2024:i:4:d:10.1007_s10368-024-00626-8
    DOI: 10.1007/s10368-024-00626-8
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    More about this item

    Keywords

    Exports; Emerging markets; Exchange rate uncertainty; Panel data;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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