01963cas a2200265 a 4500 AALejournalIMF016425 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513531793 1018-5941 BD-DhAAL BD-DhAAL Hannan, Swarnali. Global Value Chains and the Exchange Rate Elasticity of Exports / Swarnali Hannan, Maximiliano Appendino, Michele Ruta. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (28 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper analyzes how the formation of Global Value Chains (GVCs) has affected the exchange rate elasticity of exports. Using a panel framework covering 46 countries over the period 1996-2012, we first find some suggestive evidence that the elasticity of real manufacturing exports to the Real Effective Exchange Rate (REER) has decreased over time. We then examine whether the formation of supply chains has affected this elasticity using different measures of GVC integration. Intuitively, as countries are more integrated in global production processes, a currency depreciation only improves competitiveness of a fraction of the value of final good exports. In line with this intuition, we find evidence that GVC participation reduces the REER elasticity of manufacturing exports by 22 percent, on average. Mode of access: Internet Appendino, Maximiliano. Ruta, Michele. IMF Working Papers; Working Paper ; No. 2015/252 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/252/001.2015.issue-252-en.xml IMF e-Library