Abstract

This study tries to investigate the Exchange Rate volatility effects on Jordanian International Trade for the period (1997Q₁-2013Q₂). The variables include Real Exchange Rate (RER) volatility on Real Gross Domestic Product (RGDP), Exports (EX) and Imports (IMP). In order to estimate volatility, this study used the Autoregressive Conditional Heteroscedasticity (ARCH) model proposed by Engle (1982) and the Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model proposed by Bollerslev (1986). The results show that there is negative effects of real exchange rate volatility on imports and exports of Jordanian economy and a positive effect on real GDP.

Keywords:

ARCH, jordan, international trade, real exchange rate, volatility,

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Competing interests

The authors have no competing interests.

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The authors have no competing interests.