TITLE

Estimation Of The Marshall-Lerner Condition For Namibia

AUTHOR(S)
Eita, Joel Hinaunye
PUB. DATE
May 2013
SOURCE
International Business & Economics Research Journal;May2013, Vol. 12 Issue 5, p511
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
According to the Marshall-Lerner condition, the sum of trade elasticities should be greater than one for a change in exchange rate to have an impact on the country's balance of payments. This paper applies cointegrated vector autoregression to empirically estimate the Marshall-Lerner condition in Namibia. The main purpose is to test the impact of change in exchange rate on the trade balance. The paper investigates if trade elasticities are high enough in order to justify a change in exchange rate as an appropriate policy to improve the trade balance of the balance payments. The results indicate that world income has a positive effect on exports, while real exchange rate appreciation discourages exports. Imports respond positively to both domestic income and real exchange rate appreciation. The results indicate that imports and exports respond significantly to a change in the exchange rate and suggest that Marshall-Lerner condition holds for Namibia.
ACCESSION #
87526407

 

Related Articles

  • THE EFFECTS OF REAL EXCHANGE RATE ON TRADE BALANCE IN COTE D'IVOIRE: EVIDENCE FROM THE COINTEGRATION ANALYSIS AND ERROR-CORRECTION MODELS. Herve, Drama Bedi Guy; Yao Shen; Amed, Amzath // Journal of Applied Research in Finance (JARF);Jun2010, Vol. 2 Issue 1, p44 

    This paper investigates the effect of real exchange rate on the balance of trade of Cote d'Ivoire using multivariate cointegration tests and vector error correction models with time series data covering the periods of 1975-2007. Our investigation results confirm the existence of long-run...

  • THE J-CURVE DYNAMICS OF U.S. BILATERAL TRADE. Bahmani-Oskooee, Mohsen; Ratha, Artatrana // Journal of Economics & Finance;Spring2004, Vol. 28 Issue 1, p32 

    Three earlier studies examined the impact of dollar depreciation on bilateral trade between the United States and her six largest trading partners. They used different methodologies that resulted in different outcomes. In this paper we consider 18 major trading partners of the United States and...

  • Menu Costs, Trade Flows, and Exchange Rate Volatility. Lewis, Logan T. // Working Papers -- U.S. Federal Reserve Board's International Fin;2014, Issue 1102, preceding p1 

    U.S. imports and exports respond little to exchange rate changes in the short run. Pricing behavior has long been thought central to explaining this response: if local prices do not respond to exchange rates, neither will trade flows. Sticky prices and strategic complementarities in price...

  • IV. International Trade.  // Canadian Economic Observer;Apr2005 Statistical Summary, Vol. 18, p29 

    The article presents graphs and data on international trade. Graphs on the following topics are included in the article: current account balance, merchandise trade balance, exports and imports, and Prices. The data depicts Canadian balance of international payments.

  • External Sector: Outlook.  // Ecuador Country Monitor;Mar2012, p13 

    The article provides an outlook on the performance of the external sector in Ecuador. It states that Ecuador's main exports lost their free access to the U.S. due to the expiration of the Andean Trade Promotion and Drug Eradication Act (ATPDEA) while an increase in current-account deficit is...

  • ECONOMIC INDICATORS FOR JAPAN.  // Economy, Culture & History Japan Spotlight Bimonthly;Mar/Apr2005, Vol. 24 Issue 2, p62 

    Presents tabular representations of the economic indicators in Japan as of December 2004. Gross domestic product and industrial production; Balance of payments, foreign trade and foreign exchange rate; Foreign trade-exports and imports by major destinations.

  • PART 1: The global economy: Balance of payments -- measurement and management. Sherlock, Jim; Reuvid, Jonathan // Handbook of International Trade;2005, p12 

    The chapter discusses the measurement and accounting of trade in Great Britain. It identifies the three yardsticks commonly used in comparing the trade performance of relative economies. It defines several trade accounting concepts, namely balance on goods, balance on services, balance of...

  • CHAPTER 8: Influences on wood products markets and trade. Peck, Tim // International Timber Trade;2001, p202 

    The article presents a discussion on the factors that influences the wood products market and trade. It presented several factors such as production costs, the exchange rates which affects the competitiveness of exporters, and tariffs and non-tariff barriers to trade. It also include export...

  • THE EFFECT OF DEVALUATION ON THE PRICE LEVEL. Sohmen, Egon // Quarterly Journal of Economics;May58, Vol. 72 Issue 2, p273 

    The article discusses the belief that depreciation of an overvalued currency must mean a rise in the domestic price level of the depreciating country unless it is accompanied by deflationary fiscal and monetary policies. The author suggests that a depreciated exchange rate implies a price...

Share

Read the Article

Courtesy of THE LIBRARY OF VIRGINIA

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics