Journal of Forest Economics > Vol 36 > Issue 4

On the Asymmetric Effects of Exchange Rate Changes on Trade Flows: Evidence from the U.S.-Canada Trade in Forest Products

Jiangqin Xu, Business School, Hubei University, China, xujq68@126.com , Jungho Baek, Department of Economics, School of Management, University of Alaska Fairbanks, USA, baek3@alaska.edu
 
Suggested Citation
Jiangqin Xu and Jungho Baek (2021), "On the Asymmetric Effects of Exchange Rate Changes on Trade Flows: Evidence from the U.S.-Canada Trade in Forest Products", Journal of Forest Economics: Vol. 36: No. 4, pp 383-406. http://dx.doi.org/10.1561/112.00000535

Publication Date: 11 Oct 2021
© 2021 Jiangqin Xu and Jungho Baek
 
Subjects
 
Keywords
JEL Codes: C22, F14, L73
Asymmetric effectCanadaExchange ratesForest productsNARDL
 

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In this article:
1. Introduction 
2. The Model and Methods 
3. The Results 
4. Concluding Remarks 
Appendix: Data Sources and Definition 
References 

Abstract

Up to now, relatively little attention has been given to the asymmetric effects of exchange rates on the trade balance in the forest economics literature. Thus, the primary thrust of this article is to probe the asymmetric impacts of exchange rates on exports and imports in the context of bilateral trade of forest products between the U.S.A. and Canada. To this end, we use the method of the nonlinear autoregressive distributed lag (NARDL). We discover that there is evidence that ups and downs of exchange rates appear to have asymmetric impacts on U.S. forest product trade with Canada in the long-run, though not in the short-run. Additionally, the dollar’s depreciation has a more substantial long-run effect than appreciation.

DOI:10.1561/112.00000535