This paper investigates the effects of the renminbi(RMB)exchange rate on trade prices and volumes in selected Belt and Road Initiative(BRI)countries in comparison with the effects of the US dollar.The stylized facts s...This paper investigates the effects of the renminbi(RMB)exchange rate on trade prices and volumes in selected Belt and Road Initiative(BRI)countries in comparison with the effects of the US dollar.The stylized facts show that the RMB is underused in bilateral trade with selected BRI countries where intermediate goods dominate.By estimating the level of exchange rate pass-through and trade volume elasticity,we find that the RMB is significantly correlated with the volume of imports in the sample countries,predicted by the producer currency pricing(PCP)paradigm.We also regroup intermediate and final goods between China and the BRI countries.The evidence shows that dollar fluctuation affects export volumes,reflecting the role of the US as a final goods destination,whereas the RMB exerts a significant impact on the volume of intermediate goods imported from China to the sample countries due to China s important position in global value chains.展开更多
This paper investigates the RMB exchange rate from a long-run viewpoint. Whether China＇s rapid economic growth brought about real exchange rate appreciation between 1975 and 2002 is empirically examined, based on a s...This paper investigates the RMB exchange rate from a long-run viewpoint. Whether China＇s rapid economic growth brought about real exchange rate appreciation between 1975 and 2002 is empirically examined, based on a supply-side model, the Balassa-Semuelson Hypothesis （BSH）. The same test is conducted on Japan, Hong Kong, Korea, Malaysia, Singapore, Thailand, the Philippines, Indonesia and India. Our result indicates that the BSH only exists where the industrial structure has been upgraded and the economy has been successfully transformed from an agricultural economy to a manufacturing economy. Interestingly, China, among those where the BSH does not present, appears to be upgrading its industrial and trade structure. We then try to answer the question of why past rapid growth has no significant relationship with the RMB real exchange rate and what factors are underlying the trend of the RMB real exchange rate. We expect an appreciating trend of RMB real exchange rate in the foreseeable future, presuming that China＇s industrial upgrading process continues and the factors pertaining to the BSH＇s prediction, such as rise of wage rates in both tradables and nontradables, become more significant.展开更多
文摘This paper investigates the effects of the renminbi(RMB)exchange rate on trade prices and volumes in selected Belt and Road Initiative(BRI)countries in comparison with the effects of the US dollar.The stylized facts show that the RMB is underused in bilateral trade with selected BRI countries where intermediate goods dominate.By estimating the level of exchange rate pass-through and trade volume elasticity,we find that the RMB is significantly correlated with the volume of imports in the sample countries,predicted by the producer currency pricing(PCP)paradigm.We also regroup intermediate and final goods between China and the BRI countries.The evidence shows that dollar fluctuation affects export volumes,reflecting the role of the US as a final goods destination,whereas the RMB exerts a significant impact on the volume of intermediate goods imported from China to the sample countries due to China s important position in global value chains.
文摘This paper investigates the RMB exchange rate from a long-run viewpoint. Whether China＇s rapid economic growth brought about real exchange rate appreciation between 1975 and 2002 is empirically examined, based on a supply-side model, the Balassa-Semuelson Hypothesis （BSH）. The same test is conducted on Japan, Hong Kong, Korea, Malaysia, Singapore, Thailand, the Philippines, Indonesia and India. Our result indicates that the BSH only exists where the industrial structure has been upgraded and the economy has been successfully transformed from an agricultural economy to a manufacturing economy. Interestingly, China, among those where the BSH does not present, appears to be upgrading its industrial and trade structure. We then try to answer the question of why past rapid growth has no significant relationship with the RMB real exchange rate and what factors are underlying the trend of the RMB real exchange rate. We expect an appreciating trend of RMB real exchange rate in the foreseeable future, presuming that China＇s industrial upgrading process continues and the factors pertaining to the BSH＇s prediction, such as rise of wage rates in both tradables and nontradables, become more significant.
