Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/46975
Authors: 
Fischer, Malte
Year of Publication: 
1997
Series/Report no.: 
Kiel Working Paper 830
Abstract (Translated): 
The impact of exchange rate uncertainty on international trade has been discussed controversially in economic policy and theory for a long time. The paper surveys the theoretical investigations on this topic. The early modeis which analyse the influence of exchange rate uncertainty on trade, conclude that exchange rate uncertainty has a negative impact on the trade volume and may induce changes of the prices of traded goods. These results, however, are due to the very restrictive and often unrealistic assumptions of the modeis. Thus, extensions of the basic modeis have been developed. By relaxing the assumptions in order to better reflect reality, these extended modeis show that under certain conditions exchange rate uncertainty has no or even a positive impact on international trade. Thus, it becomes evident that the results of the theoretical analysis to a great extent depend on the underlying assumptions of the modeis.
Subjects: 
International Trade
Exchange Rates
Uncertainty
JEL: 
F41
G10
D81
Document Type: 
Working Paper

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