TY  - JOUR
AU  - Goldberg,Linda S.
AU  - Klein,Michael W.
TI  - Foreign Direct Investment, Trade and Real Exchange Rate Linkages in     Developing Countries.
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6344
PY  - 1997
Y2  - December 1997
UR  - http://www.nber.org/papers/w6344
L1  - http://www.nber.org/papers/w6344.pdf
N1  - Author contact info:
Linda S. Goldberg
Research Department, 3rd Floor
Federal Reserve Bank-New York
33 Liberty Street
New York, NY 10045
Tel: 212/720-2836
Fax: 212/720-6831
E-Mail: linda.goldberg@ny.frb.org

Michael W. Klein
Fletcher School
Tufts University
Medford, MA 02155
Tel: (617) 627-2718
Fax: (617) 627-3712
E-Mail: michael.klein@tufts.edu
AB  - We investigate the relationships among trade, foreign direct investment and the real exchange rate between a set of Southeast Asian and Latin American countries and both the United States and Japan.  Foreign direct investment by both Japan and the United States to the Southeast Asian countries in our sample is significantly affected by bilateral real exchange rates.  Also, trade between the countries in our sample and the United States and Japan is significantly affected by foreign direct investment. These sets of relationships, between the real exchange rate and foreign direct investment, and between foreign direct investment and trade, support two channels through which the real exchange rate affects trade: a direct effect on the relative price of goods and an indirect effect through foreign direct investment.
ER  -