Abstract
This article examines the effects of exchange rate variability on export demand for semiconductors, which is the largest sub-sector of electronics industry in Malaysia as reported by Malaysian Industrial Development Authority (MIDA, 2004). The empirical results, which are estimated based on the Johansen's multivariate cointegration tests and error-correction model, suggest that there is a unique long-run relationship among quantities of export, relative price, real foreign income and real exchange rate variability. The major finding of this article is that the variability of real exchange rate has some effect on semiconductor exports in both the long run and the short run. In the light of rapid advances in technology in the global markets for electronics products, the findings are useful to policy makers for the design and target of appropriate exchange rate and industrial policies to enhance the export competitiveness of semiconductor industry.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
