An Empirical Analysis of Textiles Export in Taiwan
Date Issued
2015
Date
2015
Author(s)
Hu, Li-Chiang
Abstract
Over the past decade, the textile industry still makes a great contribution to economic development and foreign exchange earnings in Taiwan. In 2014, textiles export reached to $11.57 billion, and the trade surplus amounted to $8.15 billion which is the fourth largest trade surplus industry in Taiwan. The textiles export dependence up to 77% on average over the decade, it shows Taiwan''s textile industry is highly export-oriented. So, the textiles export is an important indicator to evaluate the development of textile industry in Taiwan. To figure out the factors for Taiwan''s textiles export, we select exchange rate, oil prices, cotton prices, overseas production ratio, the export price index, and composite leading indicators of the US economy as explanatory variables. From January 2002 to January 2015, there are 157 observations. First, we use unit root test to ensure all the series used in regression analysis are stationary. Then, we create the vector autoregression(VAR) model to analyze how explanatory variables affect textiles export and use impulse response function to figure out the response of textiles export to the exogenous shock of another variables. Granger causality test is also used to determine whether a time series is useful in forecasting another. Eventually, we use the statistically significant variables in multiple regression analysis to investigate the impact factors for textiles export. The conclusion of this research shows that the Taiwan''s textiles export is affected by “two lags of itself”, “first lag of RMB against the Taiwan Dollar exchange rate”, “first lag of oil prices”, “first lag of overseas production ratio” and “first lag of export price index”.
Subjects
textiles export
price index of export
composite leading indicators
SDGs
Type
thesis
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