중력 모형을 이용한 인도 수출에서 실질 환율 및 환율 변동성 영향 분석

An Analysis of the Effect of Real Exchange Rate and Exchange Rate Volatility on Indian Export with Gravity Model

This study analyzes the impact of real exchange rate and exchange rate volatility on Indian exports. In 1993, India’s exchange rate system was changed to volatility exchange rate system and since then on, a lot of studies has been focused on the relationship among Indian exports, exchange rate and exchange rate volatility in Indian trade. Specifically, this study examines the relationship between Indian exports, real exchange rate and exchange rate volatility using the gravity model. Results show that real exchange rate impacts significantly on Indian exports, which means that the relative price devaluation of Indian currency gives a positive impact on Indian exports. Exchange rate volatility, however, does not significantly affect Indian exports because Indian economic fundamentals are strong; thus, India’s exchange rate is not volatile. Moreover India’s major export-partner countries are relatively free from exchange rate volatility. Therefore, when we examine exchange rate volatility in international trade, we have to consider not only a country’s exchange rate policy but also trade-partner-countries’exchange rate policy.