Determinants of Trade balance in Vietnam: An empirical analysis
- 발행기관 아주대학교
- 지도교수 Hee Gab Choi
- 발행년도 2014
- 제출일 2014-06-20
- 학위수여년월 2014. 8
- 학위명 석사
- 학과 국제대학원 국제통상학과
- 실제URI http://www.dcollection.net/handler/ajou/000000017296
- 본문언어 영어
- 저작권 아주대학교 논문은 저작권에 의해 보호받습니다.
초록/요약
Vietnam has experienced a long-lasting trade deficit in nearly 20 years (1993-2012) which brings a lot of negative effect to the economy. There are many researches about the determinants of the trade balance, however, there is no consensus about the key factors affecting it across countries. This study employs an unrestricted VAR model to examine determinants of trade balance in Vietnam. Quarterly data set of three endogenous variables and one exogenous variable from January 1995 to December 2012 is used in this paper. Overall, we find that trade balance in Vietnam is significantly negatively related to real domestic GDP per capita. A real depreciation of the real effective exchange rate index leads to an improvement of the trade balance. Particularly, the empirical result shows that a real foreign GDP per capita has a negative effect on the trade balance. About FDI, the model shows that FDI inflow has no impact to trade balance in Vietnam. The finding from this study suggests that to improve trade balance, exchange rate management should take into account real exchange rate for the benefit of trade balance. In addition, Vietnam should focus on enhancing export capacity. The export sectors need to improve capacity, and be able to actively manage the production so as to quickly adjust to take advantage of real depreciation of the domestic currency. Key words: Trade balance, VAR, Vietnam, Real effective exchange rate.
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ABSTRACT i
ACKNOWLEDGEMENT ii
TABLE OF CONTENT iii
LIST OF ABREVIATION v
LIST OF TABLE vi
LIST OF FIGURE vii
CHAPTER I: INTRODUCTION 1
1.1. Background 1
1.2. Statement of problem 2
1.3. Purpose of the study 3
1.4. Significant of the Study 4
1.5. Limitations of the Study 4
CHAPTER II: OVERVIEW OF TRADE IN VIETNAM 6
CHAPTER III: REVIEW OF LITERATURE AND METHODOLOGY 11
3.1. Literature review 11
3.2. Hypothesis and methodology 14
3.2.1. Hypotheses and description of variables 14
3.2.2. Methodology 17
CHAPTER IV: EMPIRICAL RESULT 21
4.1. Data 21
4.2. Testing for Unit roots 22
4.3. Johansen Cointegration test 23
4.4. Estimation of VAR Model 24
4.5. VAR Granger causality test 25
4.6. Impulse response function 27
4.7. Variance decomposition 29
4.8. Stability of unrestricted VAR model 30
4.8.1. Stability condition test 30
4.8.2. Diagnostic tests of Residuals 31
CHAPTER V: CONCLUSION AND RECOMMENDATION 33
5.1. Conclusion 33
5.2. Recommendation and future research 34
BIBIOGRAPHY 37
APPENDICES 41
