Open Access. Powered by Scholars. Published by Universities.®
Social and Behavioral Sciences Commons™
Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 2 of 2
Full-Text Articles in Social and Behavioral Sciences
The Contractionary Short-Run Effects Of Nominal Devaluation In Developing Countries: Some Neglected Nuances, Arslan Razmi
The Contractionary Short-Run Effects Of Nominal Devaluation In Developing Countries: Some Neglected Nuances, Arslan Razmi
Economics Department Working Paper Series
This paper extends the model developed by Krugman and Taylor (1978) to take into account interesting features of the evolving structure of global trade. The growing presence of transnational production chains and differential pricing behaviour of exports destined for industrial and developing countries are accommodated. Individual country and panel data pass-through estimates derived from several econometric approaches are provided to justify the latter extension. The likelihood of contractionary short-run effects of devaluations is shown to be positively related to: (1) the proportion of a country's exports destined for other developing countries, and (2) the presence of TNCs in either the …
Price Competition And The Fallacy Of Composition In Developing Country Exports Of Manufactures: Estimates Of Short-Run Growth Effects, Robert A. Blecker, Arslan Razmi
Price Competition And The Fallacy Of Composition In Developing Country Exports Of Manufactures: Estimates Of Short-Run Growth Effects, Robert A. Blecker, Arslan Razmi
Economics Department Working Paper Series
This paper studies whether intra-developing country price competition has significant effects on the short-run growth rates of developing countries that are specialized in manufactured exports. Regression estimates using the generalized method of moments (GMM) applied to annual panel data for 17 developing countries in 1983-2004 show that these countries exhibit a “fallacy of composition,” in the sense that a real depreciation relative to competing developing country exporters increases the home country’s growth rate in the short run. The results also suggest that real depreciations for these developing countries relative to the industrialized countries are contractionary.