Economic Change and Restructuring

, Volume 48, Issue 2, pp 93–117 | Cite as

The effects of exchange-rate volatility on industry trade between the US and Egypt

  • Mohsen Bahmani-OskooeeEmail author
  • Scott W. Hegerty
  • Amr S. Hosny


Recent instability in Egypt has brought attention to the role of risk in this important economy. At the same time, there is room in the ever-expanding literature on the link between exchange-rate volatility and trade flows, particularly for individual commodities, in Egypt. This study examines 36 separate export and import industries vis-à-vis the United States, from 1994 to 2007. An application of cointegration analysis and error-correction modeling finds evidence of long-run relationships for many import and export industries, with exports increasing due to higher risk in a large proportion of cases. Although most industries, particularly in imports, are nevertheless unaffected, our results differ from other studies in the literature. An analysis of our industry-level results shows that chemical imports, and exports of industries with large trade shares, are more likely to increase than are other products or imports.


Exchange rate volatility Industry data Egypt United States Bounds testing 

JEL Classification



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Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  • Mohsen Bahmani-Oskooee
    • 1
    Email author
  • Scott W. Hegerty
    • 2
  • Amr S. Hosny
    • 3
  1. 1.Center for Research on International EconomicsUniversity of Wisconsin-MilwaukeeMilwaukeeUSA
  2. 2.Department of EconomicsNortheastern Illinois UniversityChicagoUSA
  3. 3.International Monetary FundWashingtonUSA

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