The asymmetric effects of exchange rate volatility on international trade in a transition economy: the case of Vietnam

This study examines the asymmetric effects of Exchange Rate Volatility (ERV) on Vietnam’s international trade. Using time-series data fitted to the Nonlinear Autoregressive Distributed Lag (NARDL) model, we find that positive changes in ERV have a negative impact on the trade balance in the short-run. On the other hand,increases in ERV have a positive impact on the trade balance in the long-run. We also find that negative changes in ERV do not have any significant effect on the trade balance.