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The export response to exchange rates and product fragmentation: the case of Chinese manufactured exports

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  • Nobuaki Yamashita
  • Sisira Jayasuriya

Abstract

This paper examines how changes in the Chinese real exchange rate affect China's exports in the context of global production networks. It highlights the misspecification inherent in conventional export models and the importance of distinguishing between the very different impacts of exchange rate changes relative to export destinations and those relative to sources of parts and components. Our empirical estimates cast further doubts on the effectiveness of Chinese exchange rate adjustments for reducing Chinese export volumes.

Suggested Citation

  • Nobuaki Yamashita & Sisira Jayasuriya, 2013. "The export response to exchange rates and product fragmentation: the case of Chinese manufactured exports," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 18(2), pages 318-332.
    • Handle: RePEc:taf:rjapxx:v:18:y:2013:i:2:p:318-332
    DOI: 10.1080/13547860.2013.778161
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    References listed on IDEAS

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    1. Mr. Stephen Tokarick, 2010. "A Method for Calculating Export Supply and Import Demand Elasticities," IMF Working Papers 2010/180, International Monetary Fund.
    2. Nobuaki Yamashita, 2011. "The Currency of the People’s Republic of China and Production Fragmentation," Macroeconomics Working Papers 23209, East Asian Bureau of Economic Research.
    3. Nobuaki Yamashita, 2010. "International Fragmentation of Production," Books, Edward Elgar Publishing, number 13615.
    4. Shaghil Ahmed, 2009. "Are Chinese exports sensitive to changes in the exchange rate?," International Finance Discussion Papers 987, Board of Governors of the Federal Reserve System (U.S.).
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    Citations

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    Cited by:

    1. Willem Thorbecke, 2015. "Measuring the Competitiveness of China's Processed Exports," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 23(1), pages 78-100, January.
    2. Witada Anukoonwattaka, 2013. "International Production Sharing and Exchange Rates of Asian Countries," Studies in Trade and Investment 80, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
    3. Thorbecke, Willem, 2019. "East Asian value chains, exchange rates, and regional exchange rate arrangements," Journal of Asian Economics, Elsevier, vol. 65(C).

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