Download or read book Firm Specific Exchange Rate Exposure and Employment Adjustment written by Mi Dai and published by . This book was released on 2014 with total page 49 pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate how firms' exposure to exchange rate shocks affect their employment decisions using a comprehensive firm-level data from China that match employment information with exports by destination and imports by source country. Exposure to exchange rate shocks varies across firms because of firms' different export and import orientation, as well as different distributions of trading partners. We propose a theory-consistent and firm-specific measure of exchange rate exposure to account for both dimensions of heterogeneity and exploit the variations from both sources to identify the impact of exchange rate changes. We find that exchange rate changes significantly affect firm employment by changing their marginal revenue of exports and marginal cost of importing intermediate inputs. Job creation exhibits larger sensitivity to exchange rate changes than job destruction. Also, using firm-specific exchange rate exposure creates more theory-consistent estimation results than using aggregate exchange rate exposure in firm-level studies.
Download or read book An International Comparison of Employment Adjustment to Exchange Rate Fluctuations written by Simon M. Burgess and published by . This book was released on 1996 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper evaluates the response of employment to exchange rate shocks at the industry level for the G-7 countries. Using a simple empirical framework that places little a priori structure on the pattern of response to shocks, we find the data are consistent with the view that employment in European industries, at least France and Germany, is much less influenced by exchange rate shocks and much slower to adjust to long run steady states. The United States, Japan, Canada, the United Kingdom and Italy all appear to adjust more quickly. German and Japanese employment are quite insensitive to exchange rate fluctuations, consistent with previous research on output and markup responses to exchange rates.
Download or read book Exchange Rate External Orientation of Firms and Wage Adjustment written by Francesco Nucci and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: We estimate the effect of exchange rate movements on firm-level wages, using a representative panel of Italian manufacturing firms. We show that the direction and size of wage adjustment is shaped by the international exposure of each firm on both the sale and cost side of the balance sheet, similar to the response of employment documented in (Nucci and Pozzolo, Journal of International Economics 2010; 82: 112.). Through the revenue side, wages tend to rise after a currency depreciation and the effect is more pronounced the higher is the firm's exposure to sales from exports. Through the expenditure side, a depreciation induces a cut in the firm's wages, and the effect is larger the higher is the incidence of imported inputs in total production costs. For a given degree of external orientation, both these effects are larger for firms with a lower market power. Moreover, we document that the effect of exchange rates on wages is shaped by the extent of sectoral import penetration in the domestic market.
Download or read book The Real Exchange Rate and Employment in China written by Ms.Ruo Chen and published by International Monetary Fund. This book was released on 2011-06-01 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the impact of real exchange rate fluctuations on sectoral and regional employment in China from 1980 to 2008. In contrast to theoretical predictions, employment in both the tradable and non-tradable sectors contracts following a real appreciation. Our results are robust across different sub-samples, levels of sectoral disaggregation, and are more pronounced for regions with higher export exposure. We attribute our findings to the importance of services as intermediate input in exportable production. We test this channel of exchange rate transmission using regional input-output tables linked with employment data at the region-sector level. The results of this paper have important implications for China's labor market adjustment should the Chinese RMB strengthen in the future. To mitigate the costs of short-run labor market adjustment, appropriate demand management and structural reforms in the non-traded sectors should play an important role.
Download or read book Exchange Rates and Corporate Performance written by Yakov Amihud and published by Beard Books. This book was released on 2003 with total page 268 pages. Available in PDF, EPUB and Kindle. Book excerpt: This is a reprint of a previously published book. It consists of a series of papers by experts in the field on how the exchange rate volatility of the 1980s affected the financial policies of international firms.
Download or read book Handbook of Exchange Rates written by Jessica James and published by John Wiley & Sons. This book was released on 2012-05-29 with total page 674 pages. Available in PDF, EPUB and Kindle. Book excerpt: Praise for Handbook of Exchange Rates “This book is remarkable. I expect it to become the anchor reference for people working in the foreign exchange field.” —Richard K. Lyons, Dean and Professor of Finance, Haas School of Business, University of California Berkeley “It is quite easily the most wide ranging treaty of expertise on the forex market I have ever come across. I will be keeping a copy close to my fingertips.” —Jim O’Neill, Chairman, Goldman Sachs Asset Management How should we evaluate the forecasting power of models? What are appropriate loss functions for major market participants? Is the exchange rate the only means of adjustment? Handbook of Exchange Rates answers these questions and many more, equipping readers with the relevant concepts and policies for working in today’s international economic climate. Featuring contributions written by leading specialists from the global financial arena, this handbook provides a collection of original ideas on foreign exchange (FX) rates in four succinct sections: • Overview introduces the history of the FX market and exchange rate regimes, discussing key instruments in the trading environment as well as macro and micro approaches to FX determination. • Exchange Rate Models and Methods focuses on forecasting exchange rates, featuring methodological contributions on the statistical methods for evaluating forecast performance, parity relationships, fair value models, and flow–based models. • FX Markets and Products outlines active currency management, currency hedging, hedge accounting; high frequency and algorithmic trading in FX; and FX strategy-based products. • FX Markets and Policy explores the current policies in place in global markets and presents a framework for analyzing financial crises. Throughout the book, topics are explored in-depth alongside their founding principles. Each chapter uses real-world examples from the financial industry and concludes with a summary that outlines key points and concepts. Handbook of Exchange Rates is an essential reference for fund managers and investors as well as practitioners and researchers working in finance, banking, business, and econometrics. The book also serves as a valuable supplement for courses on economics, business, and international finance at the upper-undergraduate and graduate levels.
Download or read book Exchange Rates and Wages written by Linda S. Goldberg and published by . This book was released on 2001 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: The effects of exchange rate fluctuations across the population is an important issue for increasingly globalized economies. Previous studies using industry aggregate data have found differences across industries in the labor market implications of exchange rates, reporting that industry wages are significantly more responsive than industry employment. We offer an explanation for this paradoxical finding. Using Current Population Survey data for 1976 through 1998, we document that the main mechanism for exchange rate effects on wages occurs through job turnover and the strong consequences this has for the wages of workers undergoing such job transitions. By contrast, workers who remain with the same employer experience little if any wage impacts from exchange rate shocks. In addition, we find that the least educated workers who also have the most frequent job changes shoulder the largest adjustments to exchange rates.
Download or read book A Re examination of Exchange Rate Exposure written by Kathryn M. E. Dominguez and published by . This book was released on 2001 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: Finance theory suggests that changes in exchange rates should have little influence on asset prices in a world that has become increasingly with integrated capital markets. Indeed, the existing literature examining the relationship between international stock prices and exchange rates finds little evidence of systematic exchange rate exposure. We argue in this paper that the absence of evidence may be due to restrictions imposed on the sample of data and the empirical specifications used in previous studies. We study a broad sample of firms in eight countries over an eighteen-year period. We find that firm-level and industry-level share values are significantly influenced by exchange rates. Further, we do not find evidence that exchange rate exposure is falling (or becoming less statistically significant) over time. Our results suggest that significant firm, industry and country-specific differences remain even as financial markets become more and more 'integrated'.
Download or read book Real Exchange Rate Volatility and Employment written by Anubha Dhasmana and published by . This book was released on 2015 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the impact of real exchange rate volatility on firm level employment using a difference-in-difference model applied on a panel of 900 manufacturing firms. Trade exposure as measured by the difference between the shares of exports and imports in a firm's total revenues and input costs respectively, emerges as an important determinant of firm's response to higher exchange rate volatility. Firms with a positive trade exposure are found to experience a larger increase, or a smaller decrease, in employment growth than similar “non-exposed” firms in response to an increase in real exchange rate volatility. The impact of exchange rate volatility on employment is found to be non-linear in trade exposure. Finally, domestically owned firms respond differently to exchange rate shocks as compared to the foreign owned firms. Similarly, exporters respond differently to higher exchange rate volatility than the non-exporters.
Download or read book Exchange Rate Uncertainty and Labour Market Adjustment Under Fixed and Flexible Exchange Rates written by Yu-Fu Chen and published by . This book was released on 2002 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book An International Comparison of Employment Adjustment to Exchange Rate Fluctuations written by Simon M. Burgess and published by . This book was released on 2001 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper evaluates the response of employment to exchange rate shocks at the industry level for G-7 countries. Using an empirical framework that places little structure on the data, we find that European industries, at least France and Germany, are much less influenced by exchange rate shocks and much slower to adjust to long run steady states. The United States, Japan, Canada, the United Kingdom and Italy all appear to adjust more quickly. German and Japanese employment are quite insensitive to exchange rate fluctuations, consistent with previous research on output and markup responses to exchange rates.
Download or read book Firm Specific Factors and the Exchange Rate Exposure of Multinational Corporations written by Anand Krishnamoorthy and published by . This book was released on 1999 with total page 214 pages. Available in PDF, EPUB and Kindle. Book excerpt: The results indicate that a firms degree of concentration in foreign sales has an impact on its exchange rate exposure. These results imply that restructuring operations can reduce a firms exchange rate risk.
Download or read book The Effects of Exchange Rate Variability on Output and Employment written by and published by . This book was released on 1984 with total page 96 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Foreign Exchange Risk and Direct Foreign Investment written by Michael H. Siegel and published by . This book was released on 1983 with total page 122 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Exchange Rates and the Firm written by R. Friberg and published by Palgrave Macmillan. This book was released on 1999-07-27 with total page 184 pages. Available in PDF, EPUB and Kindle. Book excerpt: The first book to provide an integrated treatment of financial and operating strategies to exchange rate variability. The choice of price-setting currency, when and how to adjust prices, the limitations of hedging and segmentation of national markets are some of the issues analyzed. The book investigates the impact of EMU.
Download or read book Assessing Job Flows Across Countries written by John C. Haltiwanger and published by World Bank Publications. This book was released on 2006 with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper reviews the process of job creation and destruction across a sample of 16 industrial and emerging economies over the past decade. It exploits a harmonized firm-level data set drawn from business registers and enterprise census data. The paper assesses the importance of technological factors that characterize different industries in explaining cross-country differences in job flows. It shows that industry effects play an important role in shaping job flows at the aggregate level. Even more importantly, differences in the size composition of firms-within each industry-explain a large fraction of the overall variability in job creation and destruction. However, even after controlling for industry/technology and size factors there remain significant differences in job flows across countries that could reflect differences in business environment conditions. The authors look at one factor shaping the business environment, namely, regulations on hiring and firing of workers. To minimize possible endogeneity and omitted variable problems associated with cross-country regressions, we use a difference-in-difference approach. The empirical results suggest that stringent hiring and firing costs reduce job turnover, especially in those industries that require more frequent labor adjustment. Regulations also distort the patterns of industry/size flows. Within each industry, medium and large firms are more severely affected by stringent labor regulations, while small firms are less affected, probably because they are partially exempted from such regulations or can more easily circumvent them.
Download or read book German Exchange Rate Exposure at DAX and Aggregate Level International Trade and the Role of Exchange Rate Adjustment Costs written by Horst Entorf and published by . This book was released on 2006 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: This article analyses value changes of German stock market companies in response to movements of the US dollar. The approach followed in this work extends the standard means of measuring exchange rate exposure in several ways, e.g. by using multi-factor modelling instead of augmented CAPM, application of moving window panel regressions, and orthogonalization of overall market risk vis-agrave;-vis currency risk. A further innovation lies in testing theoretical implications of exchange rate adjustment costs (hedging costs) for firm values and economic exposure. Based on time series and panel data of German DAX companies, DM/ dollar rates and macroeconomic factors, we find a rather unstable, time-variant exposure of German stock market companies. Dollar sensitivity is positively affected by the ratio of exports/GDP and negatively af-fected by imports/GDP. Moreover, as expected from theoretical findings, firm values and exchange rate exposure are significantly reduced by adjustment costs depending on the distance of the exchange rate from the expected long-run mean.
