ARCHIVES
VOL. 7, ISSUE 9 (2020)
The effect of real exchange rate volatility on agricultural exports in Sri Lanka
Authors
Mayuri P Madhusanka
Abstract
In the study of measuring the Effect of Real Exchange Rate Volatility (RERV) on Agricultural Exports (AGX) in Sri Lanka, secondary data from Central Bank Reports of Sri Lanka (CBRSL) and statistics from International Monetary Fund were employed. The main objective of the study is focused on identifying effect of RERV on AGX and thereby, a core objective has been set up. That is, identification of AGXs effect to Trade Balance (TB) as AGX is also included in the TB. The secondary data of CBRSL were used from year 1996 to 2018. Therefore, to analyze these data both descriptive statistic tools and econometric tools were used. Ordinary Least Square (OLS) method was used to test the variables by using Statistical Package for Social Sciences (SPSS). The results of OLS depicted that, a strong relationship can be seen between Real Exchange Rate (RER) and AGX. This strong relationship was positive in nature. Therefore, when RER appreciates AGX appreciated. When RER depreciates AGX depreciated. As well as, for TB, AGX showed a positive relationship. When AGX goes up TB deficit narrowed and vice versa. Furthermore, e-views has been used to run the Unit Root Test (URT) and Granger Causality Test (GCT). From the URT it was identified that, all the variables considered in this study were not stationary and has a unit root. GCT showed a unidirectional causality between RER vs AGX and AGX vs TB. The overall results brought into consideration that, government should design proper strategies to brighter the AGX and should ensure the security of Agricultural Exporters against short run and long run risks.
Download
Pages:66-70
How to cite this article:
Mayuri P Madhusanka "The effect of real exchange rate volatility on agricultural exports in Sri Lanka". International Journal of Multidisciplinary Research and Development, Vol 7, Issue 9, 2020, Pages 66-70
Download Author Certificate
Please enter the email address corresponding to this article submission to download your certificate.
