Dr. Kwan Young Lee presented at the Western Economic Association International Conference

Dr. Kwan Young Lee presented his research “Exchange Rates, Foreign-Currency Debuts and the Margins of Exports: Firm-Level Evident” at The Western Economic Association International Conference on June 28 – July 2, 2019 in San Francisco, California.

Authors on the paper included Kwan Young Lee (University of North Dakota) and Kanda Naknoi (University of Connecticut).

Paper Abstract:

This study empirically examines the effects of currency depreciation on the exporting firms’ borrowing costs and exports. Using Korean data, first we find novel evidence that unanticipated currency depreciation increases the firm-level real interest rate for firms in sectors importing intermediate inputs. Next, we show that currency depreciation has contractionary effects of rising costs of borrowing and imported inputs, and an expansionary effect of an improvement in price competitiveness. The overall effect of currency depreciation on exports is found to be contractionary, and our estimation has captured the effects of large financial shocks during financial crises.