Volume 30, Issue 3 (Autumn 2025)
JEPR 2025, 30(3): 0-0 |
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Naghibzadeh F, Hojabr Kiani K, Rajaei Y, Rahimzadeh A. (2025). Investigating the effects of asymmetric exchange rate fluctuations on the added value of different sectors of Iran's economy. JEPR. 30(3),
URL: http://eprj.ir/article-1-2334-en.html
URL: http://eprj.ir/article-1-2334-en.html
1- , Kianikh@yahoo.com Kianikh@yahoo.com
Abstract: (571 Views)
This study investigates and evaluates the effects of exchange rate fluctuations on the value added of the industry, services, and agriculture sectors using the NARDL method. The findings indicate that exchange rate changes have an asymmetric effect on the value added of different sectors. In all sectors, a negative shock affects the value added of the sectors more strongly than a positive shock. However, according to the results, this asymmetric effect is not uniform across different sectors. Overall, the findings show that the effect of real exchange rate fluctuations on all sectors is nonlinear and asymmetric. In the industry sector, the coefficient of positive real exchange rate shocks in the long run changes the growth of value added by 0.3 percent, and the coefficient of negative real exchange rate shocks in the long run changes it by 0.47 percent. Furthermore, in the short run, positive real exchange rate shocks had a negative and significant effect on the value added of the industry sector during the period under review. In the agriculture sector, in the long run, only the negative values of real exchange rate shocks change the growth of value added in this sector by a coefficient of 2.84 percent, while the positive values of real exchange rate shocks have no significant effect on the value added of this sector.
Keywords: Asymmetric fluctuations, added value of the industry sector, added value of the service sector, added value of the agricultural sector, non-linear approach, exchange rate fluctuations.
Type of Study: Applicable |
Subject:
Macroeconomics
Received: Apr 22 2025 | Accepted: Dec 24 2025 | ePublished: May 23 2026
Received: Apr 22 2025 | Accepted: Dec 24 2025 | ePublished: May 23 2026
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24. • Arbabian, S., Ghasemy, M. R., & Seyedghaleeh, F. (2020). Assessment of the Symmetric and Asymmetric Effects of Exchange Rate Volatility on the Flow of Iran-China Industrial Trade. Iranian Economic Review, 24(4), 999-1023.
25. • Baggs, J., Beaulieu, E., & Fung, L. (2008). The Impact of Real Exchange Rate Movements on Service Sector Firms. University of Victoria.
26. • Baggs, J., Beaulieu, E., & Fung, L. (2010). Are service firms affected by exchange rate movements?. Review of Income and Wealth, 56, S156-S176. [DOI:10.1111/j.1475-4991.2010.00389.x]
27. • Bahmani‐Oskooee, M., & Mohammadian, A. (2016). Asymmetry effects of exchange rate changes on domestic production: evidence from nonlinear ARDL approach. Australian Economic Papers, 55(3), 181-191. [DOI:10.1111/1467-8454.12073]
28. • Bodnar, G. M., & Gentry, W. M. (1993). Exchange rate exposure and industry characteristics: evidence from Canada, Japan, and the USA. Journal of international Money and Finance, 12(1), 29-45. [DOI:10.1016/0261-5606(93)90008-Y]
29. • Brodsky, D. A. (1984). Fixed versus flexible exchange rates and the measurement of exchange rate instability. Journal of International Economics, 16(3-4), 295-306. [DOI:10.1016/S0022-1996(84)80006-9]
30. • Choi, B. Y., & Pyun, J. H. (2018). Does real exchange rate depreciation increase productivity? Analysis using Korean firm‐level data. The World Economy, 41(2), 604-633. [DOI:10.1111/twec.12532]
31. • Coudert, V., Couharde, C., & Mignon, V. (2011). Exchange rate volatility across financial crises. Journal of Banking & Finance, 35(11), 3010-3018. [DOI:10.1016/j.jbankfin.2011.04.003]
32. • Domar, E. D. (1946). Capital expansion, rate of growth, and employment. Econometrica, Journal of the Econometric Society, 137-147. [DOI:10.2307/1905364]
33. • Freund, C., & Weinhold, D. (2002). The Internet and international trade in services. American Economic Review, 92(2), 236-240. [DOI:10.1257/000282802320189320]
34. • Fischer, Stanley. "Long-term contracts, rational expectations, and the optimal money supply rule." Journal of political economy 85.1 (1977): 191-205. [DOI:10.1086/260551]
35. • Gatawa, N. M., & Mahmud, A. A. (2017). Impact of exchange rate fluctuations on agricultural exports (crops) in Nigeria. International Journal of Humanities and Social Science Invention, 6(3), 65-71.
36. • Gray, P., & Irwin, T. (2003). Exchange rate risk: Allocating exchange rate risk in private infrastructure projects. [DOI:10.1596/11286]
37. • Hung, J. H., & Viana, S. (1995). Modelling US services trade flows: a cointegration-ECM approach (No. 9518).
38. • Jamil, M., Streissler, E. W., & Kunst, R. M. (2012). Exchange rate volatility and its impact on industrial production, before and after the introduction of common currency in Europe. International Journal of Economics and Financial Issues, 2(2), 85-109.
39. • Keynes, J. M. (1964). The general theory of employment, interest and money (1936). The Collected Writings of John Maynard Keynes, 7, 1971-9.
40. • Oseni, I. O., Adekunle, I. A., & Alabi, M. O. (2019). Exchange rate volatility and industrial output growth in Nigeria. Journal of Economics and Management, 38(4), 129-156. [DOI:10.22367/jem.2019.38.07]
41. • Pesaran, M. H., Shin, Y. & Smith, J. (2001). "Bounds Testing Approaches to the Analysis of Level Relationships". Journal of Applied Econometrics, 16(3), 289-326. [DOI:10.1002/jae.616]
42. • Shin, Y., Yu, B. & Grenwod-Nimmo, M. (2014). "Modelling Asymmetric Cointegration and Dynamic Multipliers in a Nonlinear ARDL Framework". Festschrit in Honor of Peter Schmidt, Springer, New York, 281-314. [DOI:10.1007/978-1-4899-8008-3_9]
43. • Sharaf, M. F., & Shahen, A. M. (2022). Asymmetric impact of real effective exchange rate changes on domestic output revisited: evidence from Egypt. International Trade, Politics and Development, 7(1), 2-15. [DOI:10.1108/ITPD-09-2022-0020]
44. • Sun, C., Kim, M., Koo, W. W., Cho, G., & Jin, H. J. (2002). The effect of exchange rate volatility on wheat trade worldwide.
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