When the value of imports exceeds that of exports, the trade balance is said to be in a deficit position. The J curve is used to illustrate a movement in a variable's, which falls initially but rises up to higher levels than before in the shape of the letter 'J'. Namely, we augment a traditional growth 23. Agricultural Trade Balance, 71(3), 712-720. 22. In economics, a J Curve refers to a change in the country’s balance of trade, often following a currency devaluation or depreciation. These results add to the already existent empirical evidence for a diverse set of other economies. Fingerprint Dive into the research topics of 'Economic reforms and democracy: Evidence of a J-curve in Latin America'. Econometric 55, 251-76. A devalued currency means imports are more expensive, and on the assumption that the volumes of imports and exports change little at first, this causes a fall in the current account (a bigger deficit or smaller surplus). A country ’ s trade balance is defined as the difference between the amount it exports and the amount it imports. BIBLIOGRAPHY. This paper formalizes and expands on this concept and provides a set of quantitative methods designed to measure the productivity effects of intangible investments. Tu Cao Anh (2010), J curve effect and bilateral trade balance between Vietnam and its five major partners, Master thesis on Economics, HCMC University of Economics. The J-curve Effect and the US Agricultural Trade Balance. Mohsen Bahmani-Oskooee và các cộng sự, 2003, Is there a J-curve at the Industry Level?, … Flemingham, B. S. (1988). Crossref, ISI, Google Scholar; Bahmani-Oskooee, M and Hegerty, S [2010] The J-and S-curves: A survey of the recent literature. The J-Curve Effect outlines the consequences of the Marshall-Lerner Condition as it pertains to the relationship between time and the elasticity of goods and services being exported. In the long run, as investment quantities and capital stocks reach their steady -state, the mismeasurement problem disappears even if the intangible investments do not. investment shares of income exacerbate the magnitude of the J- curve effect. the Productivity J-Curve, building on earlier work by Yang and Brynjolfsson (2001). The Manchester School, 80, 295–320. When applied to a country's external account, it says that whenever there is depreciation in the currency's value, the trade deficit initially worsens as imports become more costly and exports take more time to react. Journal of Economic Studies, 37 (6), 580–596. Engle, R. F. and Granger, C. W. G. (1987) Cointegration and Error-correction: representation, estimation and testing. J-curve effect the tendency for a country's BALANCE OF PAYMENTS deficit to initially worsen following a DEVALUATION of its currency before then moving into surplus. J Curve in Economics. J-curve hypothesis, also called Davies’ J-curve, in sociology and political science, theory that attempts to identify the reasons behind the collective rebellion of individuals who are perceived as victims of injustice. Bulletin of Economic Research 40 (10), 43-56. Bahmani-Oskooee, M and Xu, J [2012] Is there evidence of the J-curve in commodity trade between U.S. and Hong Kong? In economics, the 'J curve' is the time path of a country’s trade balance following a devaluation or depreciation of its currency, under a certain set of assumptions. J – Curve. economic reform Social Sciences Together they form a unique fingerprint. A weak currency means that imports will be costly, while it will be more profitable to export commodities. One policy to improve a deficit situation is devaluation; that is, lowering the value of one currency in terms of another currency.
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