THE BILATERAL J-CURVE: AUSTRALIA VERSUS HER 23 TRADING PARTNERS

  1. MOHSEN BAHMANI-OSKOOEE1,*,
  2. GOUR G. GOSWAMI2,
  3. BIDYUT KUMAR TALUKDAR3

Article first published online: 13 JUN 2005

DOI: 10.1111/j.1467-8454.2005.00252.x

Issue

Australian Economic Papers

Australian Economic Papers

Volume 44, Issue 2, pages 110–120, June 2005

Additional Information

How to Cite

BAHMANI-OSKOOEE, M., GOSWAMI, G. G. and KUMAR TALUKDAR, B. (2005), THE BILATERAL J-CURVE: AUSTRALIA VERSUS HER 23 TRADING PARTNERS. Australian Economic Papers, 44: 110–120. doi: 10.1111/j.1467-8454.2005.00252.x

Author Information

  1. 1

    University of Wisconsin-Milwaukee

  2. 2

    2North South University, Bangladesh

  3. 3

    University of Manitoba

* Mohsen Bahmani-Oskooee, University of Wisconsin-Milwaukee, Milwaukee WI 53201. bahmani@csd.uwm.edu

Publication History

  1. Issue published online: 13 JUN 2005
  2. Article first published online: 13 JUN 2005

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Several studies have tested the J-curve phenomenon for Australia using non-stationary aggregate trade data and have provided mixed results. They not only suffer from the ‘aggregation bias problem’ but also from the ‘spurious regression problem’. To overcome these problems, in this paper we investigate the short-run and the long-run effects of real depreciation of the Australian dollar on the trade balance between Australia and each of her 23 trading partners using quarterly data over the 1973–2001 period and recent advances in cointegration analysis. The results from the bound testing approach for cointegration and error-correction modeling does not provide much support for the J-curve phenomenon.

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