The Influence of the Exchange Rate Regime on Foreign Trade Activity

In this paper, we study the reaction of certain groups of countries to similar major SITC export or import groups based on 335,119 observations pairs of countries per year for the period 1960 - 2015. When segmenting countries into groups with similar exported and imported goods, it is possible to identify the most effective modes for countries with a given set of characteristics. This study that allows to form general patterns of reaction of groups of countries united by selected features is not available today. The solution of the problem posed to the dissertation research to study all the main types of switching of the regime and groups of goods allows to check the existence of homogeneity in stimulating trade for the countries of the same group, and to compare different groups of countries and analyze the results for the product segments. The purpose of the study is to quantify the impact of a change in the foreign exchange regime on foreign trade activities of various groups of countries and its trading partners of similar goods on foreign trade activities. To achieve it, the following tasks are solved: classification of countries by main groups of goods (allocation of top-1 exported / imported segments for each pair of countries under study), analysis of the effect of exchange rate changes on the basis of panel data, identification of patterns for the classification of countries. Using the data and methods described in detail later, the results of the work confirm the hypothesis that there are similar effects on trade with a change in the currency regime within the groups of the selected classification of countries, and similar models for the reaction to the change in the exchange rate for most of the classifications have been obtained.