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Open Economies Review

, Volume 14, Issue 2, pp 119–134 | Cite as

Is the J-Curve Effect Observable for Small North European Economies?

  • R. Scott Hacker
  • Abdulnasser Hatemi-J
Article

Abstract

The present study tests for the J-curve for five North European countries—Belgium, Denmark, The Netherlands, Norway, and Sweden—using generalized impulse response functions. The results provide empirical support for the J-curve. Each country has an impulse response function generated from a vector error-correction model that suggests that after a depreciation, there will be a dip in the export-import ratio within the first half-year after the depreciation. The long-run export-import ratio appears to be higher than the low point of this early dip in almost all cases. Also, in most cases, the export-import ratio appears in many periods after the depreciation to be converging from below to a higher long-run equilibrium.

J-curve North European economies generalized impulse response functions exogeneity 

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Copyright information

© Kluwer Academic Publishers 2003

Authors and Affiliations

  • R. Scott Hacker
    • 1
  • Abdulnasser Hatemi-J
    • 2
  1. 1.Jönköping International Business SchoolJönköpingSweden
  2. 2.Lund University and University of SkövdeSkövdeSweden

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