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The role of South Africa’s rand and its trade balance: A Linear and non-linear analysis.
Last modified: 2018-09-01
Abstract
With the new approach to evaluate relationship between real exchange rate and trade balance , this paper focus on treatment of asymmetry analysis and nonlinear models. Recent empirical analysis shows that by applying non-linear approach provide positive outcome. I have augmented this information and evaluate South Africa and its 13 trading partners. The results reveal that exchange rate changes do have short-run asymmetric effects in 2 models, both short-run and long-run asymmetric effects.
Keywords
J-curve, South Africa, Linear and Non-Linear approach, Asymmetric