Ahmed Usmana, Mohsen Bahmani-Oskooeeb, Sofia Anwara
Author information
a Department of Economics, Government College University Faisalabad, Faisalabad 38000, Pakistan
b Center for Research on International Economics, University of Wisconsin, Milwaukee, WI 53201, USA
E-mail: voice.of.usman.au@gmail.com (Ahmed Usman), bahmani@uwm.edu (Mohsen Bahmani-Oskooee, corresponding author), sofia_eco@gcuf.edu.pk (Sofia Anwar)
Abstract
The J-curve is a term used to describe short-run deterioration in the trade balance combined with long-run improvement subsequent to a currency devaluation or depreciation. While the majority of studies have tested the symmetric J-curve concept, the new direction is to test for an asymmetric J-curve. We tested both concepts for each of the 21 two-digit industries that trade between Pakistan and its major partner, China. While we found support for the symmetric J-curve in only six industries, we found support for the asymmetric J-curve in 13 industries. The two largest industries, coded 71 (machinery other than electric with 21.14% trade share) and 72 (electrical machinery, apparatus, and appliances with 16.87% trade share) were found to be in the list.
Keywords
commodity trade, Pakistan, China, asymmetric J-curve
Cite this article
Ahmed Usman, Mohsen Bahmani-Oskooee, Sofia Anwar. Asymmetric J-curve in the Commodity Trade between Pakistan and China. Front. Econ. China, 2021, 16(3): 521–547 https://doi.org/10.54605/fec20210305
