Dienstag, 29 Januar 2019 11:26
Just published by the Journal of Economic Studies (Emerald): a study by Ansgar Belke and Dominik Kronen on the impact of global policy uncertainty's on EU countries‘ foreign trade flows
Ansgar Belke, Dominik Kronen(2019): "Exchange Rate Bands of Inaction and Hysteresis in EU Exports to the Global Economy – The Role of Uncertainty", Journal of Economic Studies.
This paper estimates the role of policy and exchange rate uncertainty shocks for EU countries’ exports. They examine the performance of Germany, France, Italy and the UK, under uncertainty in exports to important global export destinations. They apply a non-linear model, where strong spurts of exports occur when changes of the exchange rate exceed a zone of inaction. They implement an algorithm describing path-dependent play-hysteresis. The hysteretic impact of real exchange rates on exports is estimated for the period from 1995M1 to 2015M12. They identify significant hysteretic effects for a large part of the EU member countries’ exports.
You can find this article here.