A weaker Swiss franc in the early 80s led — in direct contradiction to the protectionist theory — to a sharp decline in import weights. Moreover, those weights increased after the franc rallied in 1986-1987, and then embarked on a long secular decline.
Export weights from the U.S. to Switzerland fell sharply into 1996, and then rebounded somewhat regardless of what the currency did. As much of U.S.-Switzerland bilateral trade is in specialty and luxury goods, we should not expect to see much of a price elasticity on either side of the equation, and we do not.
Subscribe to:
Post Comments (Atom)
Post a Comment