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Asian financial crisis and the J-Curve : Evidence from South Korea

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  • Asian financial crisis and the J-Curve
  • Ratha, Artatrana; Kang, Eungmin
  • St. Cloud State University


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Title Asian financial crisis and the J-Curve
Similar Titles
Sub Title

Evidence from South Korea

Material Type Reports
Author(English)

Ratha, Artatrana; Kang, Eungmin

Publisher

[St. Cloud State]:St. Cloud State University

Date 2007
Journal Title; Vol./Issue Economics Faculty Working Papers:
Pages 24
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < General
Holding COnnecting REpositories

Abstract

Using an error correction version of an autoregressive distributed lag model, we investigate the dynamics of the Korean J-Curve against her eight trading partners. The strict version of the J-Curve is observed with a few major Korean trading partners, such as the U.S. and Indonesia. The estimation results from the Trade Balance Model and the Error Correction Model confirm that, after a depreciation of the Korean won, there has been a long-run adjustment toward the improvement of Korean trade balance against most trading partners. The findings are consistent over different sample periods, including before and after the financial crisis in 1997, and with different trading partners. After the Asian financial crisis, we find that the J-Curve relationship with Korean trading partners has become much more apparent than it was before the crisis.