Long Run Asymmetric Effects of Exchange Rate Variations on Nigerian Bilateral Trade Balances (Testing for the J-Curve Hypothesis)
DOI:
https://doi.org/10.51200/mjbe.v0i0.1600Abstract
This study has examined the long run effects of exchange rate and output of selected regions, on Nigerian trade balance. Trade balance and exchange rate have crucial role to play in today’s global economy and are both important in economic growth and stability. Both the symmetric and asymmetric effects are carried out in order to capture the real effect of exchange rate and also to test for the J-curve, a phenomenon refers to the trend of a country’s balance of trade following a devaluation or appreciation. Estimation technique is based on the traditional ARDL and NARDL models. Although, a long run co-integrating relationship and convergence to long run equilibrium exist in the models set, but the results show a degree of ambiguity in Nigerian trade balance determinants relative to her trading partners. This may be due to seemingly shambolic Nigerian macro economy. The suggestion offered is that sound macroeconomic framework is essential for Nigeria since the country appears to possess a significant trade advantage over most developing countries. Therefore, prudential macroeconomic policies are required to maintain stable macroeconomic framework.
Keywords: Nigerian trade balance, asymmetric effect, symmetric effect, exchange rate
Downloads
Published
How to Cite
Issue
Section
License
CCBY (Attribution)
This license enables reusers to distribute, remix, adapt, and build upon the material in any medium or format, so long as attribution is given to the creator. The license allows for commercial use. CC BY includes the following elements:
BY: Credit must be given to the creator.
All rights reserved. No part of this publication may be reproduced, distributed, stored in a database or retrieval system, or transmitted, in any form or by any means, electronic, mechanical, graphic, recording or otherwise, without the prior written permission of Universiti Malaysia Sabah Press, except as permitted by Act 332, Malaysian Copyright Act of 1987. Permission of rights is subjected to the journal.
Universiti Malaysia Sabah Press makes no representation – express or implied, with regard to the accuracy of information contained in this journal. Users of the information in this journal need to verify it on their own before utilising such information. Views expressed in this publication are those of the author(s) and do not necessarily reflect the opinion or policy of Universiti Malaysia Sabah. Universiti Malaysia Sabah Press shall not be responsible or liable for any special, consequential, or exemplary problems or damages resulting in whole or part, from the reader’s use of, or reliance upon, the contents of this journal.

