The Effect Of Industry-specify Real Effective Exchange Rate Movements On The Productivity Of Manufacturing Industries In China

As the industry-specify real effective exchange rate could differ the competition that the alternative industry is facing; this index is more useful than the aggregate real effective exchange rate on analyzing the effect of REER movements on the labor productivity between industries. As the extent of openness of China has been becoming deeper, the factories in manufacture department are facing more and more intense international competition. For the REER is an index measuring this kind of competition, calculating the industry-specify real effective exchange rate of Chinese manufacture industries is important. We use the China Customs Trade Database to calculate the industry-specify real effective exchange rate of30industries of china manufacture department. And we use the quantile regression analysis method to analysis the effect of REER movement on labor productivity. The research shows that REER has a significant negative impact on the labor productivity, and many industries exhibit a downward sloping quantile regression curve.