The J-curve: Indonesia vs. Her Major Trading Partners |
Mohsen Bahmani-Oskooee, Hanafiah Harvey |
The University of Wisconsin-Milwaukee Penn State University at Mont Alto |
Copyright ©2009 Journal of Economic Integration |
ABSTRACT |
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Couple previous studies that have investigated the J-curve phenomenon for Indonesia, have employed aggregate trade data and provided mixed results. Given the aggregation bias embodied in using trade data between Indonesia and the rest of the world, we disaggregate Indonesian trade data by trading partners and investigate the short-run as well as the long-run effects of the real bilateral exchange rate on the bilateral trade balance between Indonesia and each of her 13 trading partners. We find evidence of the J-curve effect in five out of 13 trading partners. JEL Classification: F31 |
Keywords:
Indonesia | trading partners | trade balance | J-curve | bounds testing
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REFERENCE |
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Bahmani-Oskooee, M. (1985), "Devaluation and the J-curve: Some Evidence from LDCs", The Review of Economics and Statistics, 67, p. 500-504. |
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Bahmani-Oskooee, M. (1986), "Determinants of International Trade Flows: Case of Developing Countries", Journal of Development Economics, 20, pp. 107-123. |
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