How Exchange Rate Affect Employment In Export Oriented And Import Competing Countries In Asia?
Author: Salva Aslam Raja

Previous literature focus on relation between exchange rate and employment. The purpose of this study is to investigate the relation using trade ratios at macro level data and cross-country comparison has done based on import competing (Pakistan, India) and export-oriented countries (Japan, China). This study practices the sample of four countries (Japan, China, Pakistan and India) over the period of 1990-2014 using ARDL technique. The results from Bound test shows that long run relationship exist between exchange rate and employment. The econometric analysis suggests a negative relationship between exchange rate and employment. All the variables except GDP and world interest rate are significant for all the four countries and these two variables don’t affect employment in the long run. The results indicate that Export Oriented Countries Japan and China show positive sign of trade ratios which mean the effect of devaluation of exchange rate is positive on employment and this positive sign show high openness of these countries. While the Import oriented countries Pakistan and India show negative sign which indicate low openness. Supervisor:- Dr. Hafsa Hina

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Supervisor: Hafsa Hina

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