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J - curve disparity in the goods and services sector in the Pacific region: evidence from devaluation in Fiji

Prakash, Kushneel A. and Maiti, Dibyendu S. (2014) J - curve disparity in the goods and services sector in the Pacific region: evidence from devaluation in Fiji. UNSPECIFIED. (Unpublished)

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Abstract

The J-curve phenomenon argues that currency devaluation leads to worsening of trade balance in the short run but gradually improves in the long run. The current paper attempts to empirically investigate this in the context of Fiji which has undergone devaluation four times during the last three decade. Using Vector Error Correction Model, we find evidence of J-curve phenomenon on goods trade, but not on services over the period 1975 to 2012. We argue that adjustment in the goods takes place gradually with domestic production, but not in exportable services.

Item Type: Other
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Business and Economics (FBE) > School of Economics
Depositing User: Kushneel Prakash
Date Deposited: 17 Jul 2014 12:50
Last Modified: 23 Sep 2016 11:38
URI: http://repository.usp.ac.fj/id/eprint/7536
UNSPECIFIED

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