Greater participation in global value chains(GVCs)has highlighted the impact of exchange rate shocks on international trade.This paper examines how such participation influences firms'responses to exchange rate mo...Greater participation in global value chains(GVCs)has highlighted the impact of exchange rate shocks on international trade.This paper examines how such participation influences firms'responses to exchange rate movements,focusing on the relationship between firms'pricing and value-added in exports.This study,using detailed Chinese firm-level data,demonstrates that firms with a high degree of GVC participation reacted to currency appreciation by lowering their export prices more substantially and reducing their export volumes less.This is mainly attributable to the"cost-hedging effect"within the marginal cost channel and the"pricing inhibition effect"within the markup channel.By categorizing export firms by trade models and product types,this study further demonstrates that processing trade firms at the low end of the value chain and those with low product differentiation were more inclined to absorb exchange rate shocks.This study adds to the existing theoretical framework and provides strong evidence for China in deepening GVC integration and supporting the development of high-quality export firms.展开更多
Stock exchange market responses to macroeconomic fluctuations show deviations between countries in terms of direction, magnitude and duration due to the idiosyncratic characteristics of the countries. The paper empiri...Stock exchange market responses to macroeconomic fluctuations show deviations between countries in terms of direction, magnitude and duration due to the idiosyncratic characteristics of the countries. The paper empirically searches for the identification of these variations for CEECs, namely Czech Republic, Hungary, Poland, Slovak Republic and also Turkey for the period of December, 1999 to December, 2009. The empirical analyses demonstrate that for each CEEC, stock exchange market responds positively to industrial production and to appreciation of local currency. Czech Republic and Hungary display negative and the rest display positive response to M1, whereas the response of stock market to CB policy rate shows mixed results for each country. Besides, foreign exchange market returns are found to be the variable with the highest significance in explaining the stock exchange market returns. These findings point out to arbitrage opportunities for investors and give insight to Monetary Policy Authorities about the Monetary Transmission Mechanisms of the countries.展开更多
基金support from the National Social Science Fund of China(No.15ZDC020).
文摘Greater participation in global value chains(GVCs)has highlighted the impact of exchange rate shocks on international trade.This paper examines how such participation influences firms'responses to exchange rate movements,focusing on the relationship between firms'pricing and value-added in exports.This study,using detailed Chinese firm-level data,demonstrates that firms with a high degree of GVC participation reacted to currency appreciation by lowering their export prices more substantially and reducing their export volumes less.This is mainly attributable to the"cost-hedging effect"within the marginal cost channel and the"pricing inhibition effect"within the markup channel.By categorizing export firms by trade models and product types,this study further demonstrates that processing trade firms at the low end of the value chain and those with low product differentiation were more inclined to absorb exchange rate shocks.This study adds to the existing theoretical framework and provides strong evidence for China in deepening GVC integration and supporting the development of high-quality export firms.
文摘Stock exchange market responses to macroeconomic fluctuations show deviations between countries in terms of direction, magnitude and duration due to the idiosyncratic characteristics of the countries. The paper empirically searches for the identification of these variations for CEECs, namely Czech Republic, Hungary, Poland, Slovak Republic and also Turkey for the period of December, 1999 to December, 2009. The empirical analyses demonstrate that for each CEEC, stock exchange market responds positively to industrial production and to appreciation of local currency. Czech Republic and Hungary display negative and the rest display positive response to M1, whereas the response of stock market to CB policy rate shows mixed results for each country. Besides, foreign exchange market returns are found to be the variable with the highest significance in explaining the stock exchange market returns. These findings point out to arbitrage opportunities for investors and give insight to Monetary Policy Authorities about the Monetary Transmission Mechanisms of the countries.
