| The effect of exchange rate volatility on regional exports is a new research subject. Internationally, only after the collapse of the Bretton Woods system, does research on this subject thrive: most people believe that as Economics always assume that enterprises are risk-averse, and exchange rate volatility increases exchange rate risk, so that as exchange rate volatility increases, enterprises are reluctant to export. But some others argue that when exchange rate volatility increase, enterprises would export more to make for their potential losses causing from exchange rate risk. So nowadays, research always take the form of empirical experience, focusing on different regions during different periods, and can always get different results.Because of the exchange rate forming system, research on this subject appears right after the Sep. 2005 exchange rate forming system reform in China. This paper based on Zhejiang Province's statistical data, using a cointegrational method, focuses on the process that exchange rate volatility affects the exports. This paper wants to study the case of Zhejiang Province, and share the learnings with the whole nation.This paper is divided into five chapters, chapter one puts out the question: what is the effects of exchange rate volatility on regional exports? Chapter two reviews some related theories, and some related empirical results. Chapter three focus on the effects of exchange rate forming system on the exchange rate volatility. Chapter four is the most important part of the paper, which brings in the cointegration analysis. The conclusion is that: exchange rate volatility has obvious effects on exports, and the effect is negative. Chapter five concludes the paper and gives some suggestions. To the two stakeholders, the government should continue the reform thoroughly, and develop the financial deviation market, and the enterprises should control the exchange rate risk. |
PDF Full Text Request