IDEAS home Printed from https://ideas.repec.org/a/taf/reroxx/v35y2022i1p7128-7146.html
   My bibliography  Save this article

Revisiting the nexus between exchange rate, exports and economic growth: further evidence from Asia

Author

Listed:
  • Wei Zhu
  • Fayyaz Ahmad
  • Muhammad Umar Draz
  • Ilhan Ozturk
  • Abdul Rehman

Abstract

The economic growth of developing countries has been associated with their exports, and the existing research suggests that exchange rates significantly influence the exports. This study used panel data to investigate the potential nexus of gross domestic product (GDP), exports and exchange rates in Asian countries over the period of 1981–2016. The results portray that nexus between exchange rate and exports holds true for Export-led Growth (ELG) and Growth-led Exports (GLE) hypotheses. This study used the Wald test under Vector Error Correction Model (VECM) with all necessary specifications tests to identify the possible nexus of variables, and applied the fixed effects model along with control variables. The results imply that an undervalued currency enhances exports and has a significant impact on economic growth. Additionally, the results of Fully Modified Ordinary Least Squares (FMOLS) model with financial crises dummy suggested that the estimations are robust. Keeping in view the aforementioned findings, a timely and balanced policy can play a pivotal role in improving the long term nexus of exchange rates, exports and economic growth.

Suggested Citation

  • Wei Zhu & Fayyaz Ahmad & Muhammad Umar Draz & Ilhan Ozturk & Abdul Rehman, 2022. "Revisiting the nexus between exchange rate, exports and economic growth: further evidence from Asia," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 35(1), pages 7128-7146, December.
    • Handle: RePEc:taf:reroxx:v:35:y:2022:i:1:p:7128-7146
    DOI: 10.1080/1331677X.2022.2059692
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/1331677X.2022.2059692
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/1331677X.2022.2059692?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Erdem Bulut & Zaim Reha Yasar, 2023. "Determinants of Export Performance in Emerging Market Economies: New Evidence from a Panel Quantile Regression Model," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 73(73-1), pages 453-472, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:reroxx:v:35:y:2022:i:1:p:7128-7146. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/rero .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.