Food imports and exchange rate: the application of dynamic cointegration framework
This paper studies how exchange rate policy influences households’ consumption styles represented by food imports. We provide an empirical analysis based on the Malaysian annual data from 1980-2012. An autoregressive distributed lag model (ARDL) was utilized in interpreting long-run elasticities of...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Institute for Mathematical Research, Universiti Putra Malaysia
2017
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| Online Access: | http://psasir.upm.edu.my/id/eprint/51708/ http://psasir.upm.edu.my/id/eprint/51708/1/7.%20Alhaji%20Jibrilla.pdf |
| _version_ | 1848851904702971904 |
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| author | Aliyu, Alhaji Jibrilla Ismail, Normaz Wana |
| author_facet | Aliyu, Alhaji Jibrilla Ismail, Normaz Wana |
| author_sort | Aliyu, Alhaji Jibrilla |
| building | UPM Institutional Repository |
| collection | Online Access |
| description | This paper studies how exchange rate policy influences households’ consumption styles represented by food imports. We provide an empirical analysis based on the Malaysian annual data from 1980-2012. An autoregressive distributed lag model (ARDL) was utilized in interpreting long-run elasticities of food import demand as a cointegrating relation, and short-run dynamics was interpreted using ECM based on cointegrating regression of the ARDL technique. The robustness of ARDL results are verified using Dynamic OLS (DOLS) estimation technique. Our results, while providing evidence that food import demand in the country is fairly inelastic to both income growth and relative prices of food imports, also raise some important policy issues, particularly on the competitiveness of the country’s agricultural and food exports. |
| first_indexed | 2025-11-15T10:29:36Z |
| format | Article |
| id | upm-51708 |
| institution | Universiti Putra Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T10:29:36Z |
| publishDate | 2017 |
| publisher | Institute for Mathematical Research, Universiti Putra Malaysia |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | upm-517082017-04-27T09:55:55Z http://psasir.upm.edu.my/id/eprint/51708/ Food imports and exchange rate: the application of dynamic cointegration framework Aliyu, Alhaji Jibrilla Ismail, Normaz Wana This paper studies how exchange rate policy influences households’ consumption styles represented by food imports. We provide an empirical analysis based on the Malaysian annual data from 1980-2012. An autoregressive distributed lag model (ARDL) was utilized in interpreting long-run elasticities of food import demand as a cointegrating relation, and short-run dynamics was interpreted using ECM based on cointegrating regression of the ARDL technique. The robustness of ARDL results are verified using Dynamic OLS (DOLS) estimation technique. Our results, while providing evidence that food import demand in the country is fairly inelastic to both income growth and relative prices of food imports, also raise some important policy issues, particularly on the competitiveness of the country’s agricultural and food exports. Institute for Mathematical Research, Universiti Putra Malaysia 2017 Article PeerReviewed application/pdf en http://psasir.upm.edu.my/id/eprint/51708/1/7.%20Alhaji%20Jibrilla.pdf Aliyu, Alhaji Jibrilla and Ismail, Normaz Wana (2017) Food imports and exchange rate: the application of dynamic cointegration framework. Malaysian Journal of Mathematical Sciences, 11 (spec. Feb.). pp. 101-114. ISSN 1823-8343; ESSN: 2289-750X http://einspem.upm.edu.my/journal/fullpaper/vol11sfeb/7.%20Alhaji%20Jibrilla.pdf |
| spellingShingle | Aliyu, Alhaji Jibrilla Ismail, Normaz Wana Food imports and exchange rate: the application of dynamic cointegration framework |
| title | Food imports and exchange rate: the application of dynamic cointegration framework |
| title_full | Food imports and exchange rate: the application of dynamic cointegration framework |
| title_fullStr | Food imports and exchange rate: the application of dynamic cointegration framework |
| title_full_unstemmed | Food imports and exchange rate: the application of dynamic cointegration framework |
| title_short | Food imports and exchange rate: the application of dynamic cointegration framework |
| title_sort | food imports and exchange rate: the application of dynamic cointegration framework |
| url | http://psasir.upm.edu.my/id/eprint/51708/ http://psasir.upm.edu.my/id/eprint/51708/ http://psasir.upm.edu.my/id/eprint/51708/1/7.%20Alhaji%20Jibrilla.pdf |