The Influence of RMB Real Exchange Rate on the Technical Structure of Sino-US Export Trade Products
- 1 College of Economics, Jinan University, Guangzhou, China
Abstract
Based on the classification of HS (Harmonized Commodity Description and Coding System), and according to the method of Lall (2000) [1], Sino-US trade products are divided into five categories, namely primary products, resource-intensive products, low technology products, medium technical products and high-tech products. Based on the data from the first quarter of 2005 to the fourth quarter of 2017, the influence of bilateral real exchange rate on the structure of Sino-US export trade was studied by using VAR model in this paper. The empirical results show that there is a strong granger causality between Sino-US bilateral real exchange rate and Sino-US export trade product structure, the former being the latter’s granger reason; in the short term, the appreciation (devaluation) of the real exchange rate between China and the US is conducive (inconducive) to an improvement in the trade structure, which has long been detrimental (beneficial) to the improvement of the trade structure. In general, the appreciation of RMB is unfavorable to the improvement of the technical structure of Sino-US export trade. Variance decomposition shows that Sino-US bilateral real exchange rate has a great contribution to the technical structure of Sino-US export trade.
- Sanjaya, L. (2000) The Technological Structure and Performance of Developing Country Manufactured Exports: 1985-98. Oxford Development Studies, 28, 337-369. https://doi.org/10.1080/713688318
- Eichengreen, B.J. (1983) Effective Protection and Exchange-Rate Determination. Journal of International Money & Finance, 2, 1-15. https://doi.org/10.1016/0261-5606(83)90002-5
- Capel, J. (1994) Exchange Rate Effects on a Firm’s Output Composition. De Economist, 142, 475-496. https://doi.org/10.1007/BF01384467
- Obstfeld, M. and Rogoff, K.S. (1996) Foundations of International Macroeconomics. The MIT Press, Cambridge, Mass.
- Breuer, J.B. and Clements, L.A. (2003) The Commodity Composition of US-Japanese Trade and the Yen/Dollar Real Exchange Rate. Japan & the World Economy, 15, 307-330. https://doi.org/10.1016/S0922-1425(02)00052-X
- Bahmani-Oskooee, M. and Hegerty, S.W. (2009) The Japanese-U.S. Trade Balance and the Yen: Evidence from Industry Data☆. Japan & the World Economy, 21, 161-171. https://doi.org/10.1016/j.japwor.2008.02.001
- Cimoli, M., Fleitas, S. and Porcile, G. (2013) Technological Intensity of the Export Structure and the Real Exchange Rate. Economics of Innovation & New Technology, 22, 353-372. https://doi.org/10.1080/10438599.2012.748504
- Zeng, Z. and Zhang, Y.B. (2007) Appreciation of RMB Real Exchange Rate and Adjustment of Chinese Export Trade Product Structure. World Economy, 5, 16-24.
- Wang Y.W. ,et al. (2009)The Effect of RMB Real Effective Exchange Rate and Its Fluctuation on China’s Export Structure: An Empirical Study Based on ARDL-ECM Model Quantitative Economic and Techno-Economic Research 6, 53-63.
- Jin, G.H. (2010) Export Trade Structure Effect of RMB Exchange Rate Change. Zhejiang University, Hangzhou.
- Xiao, Q.X. and Liao, W.X. (2012) RMB Exchange Rate, Export Trade Structure and Sino-US Trade Balance: An Empirical Analysis Based on SITC Standard Industry Data. International Economic and Trade Exploration, 12, 60-72.
- Yu, J.J. and Lin, L. (2013) The Trade Difference of RMB Exchange Rate Incomplete Transmission: An Analysis of the Introduction of the Value of Trading. Contemporary Finance, 2, 87-97.
- Zhang H.Q. ,et al. (2015)RMB Appreciation, Commodity Heterogeneity and Export Restructuring International Trade Issues 2, 155-167.
- Ma, D. and Xu, S.Q. (2005) China’s Trade Balance, Trade Structure and Real Effective Exchange Rate of RMB. Quantitative Economic and Techno-Economic Research, 6, 23-32.