Why You Should Use High-Frequency Data to Test the Impact of Exchange Rate on Trade
This study suggests that testing the impact of exchange rate on trade should be done using high-frequency data. Using different data frequencies for identical periods and specifications between the USA and Canada, we show that low-frequency data might suppress and distort the evidence of the impact of exchange rate on trade in the short run and the long run.
KeywordsData frequency Exchange rate and trade J-curve theory ARDL cointegration US-Canada trade
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