Net importing countries are very susceptible to changes in the value of their currency. Pakistan, being a small open economy, faces a constant pressure in its current account and BOP, which leads to unavoidable stress on its exchange rate. Exchange rate movements affect the cost of imports directly which have been studied extensively in empirical literature. However, these studies ignore the possibility of asymmetric effects of exchange rate and its impact on import demand in Pakistan. An appreciation in exchange rate may have a different impact on demand for imports than depreciations depending upon the level of rigidity in consumer preferences as well as the availability of substitutes for consumer goods, capital goods and raw materials. We use quarterly data of Pakistan’s consumer goods, capital goods and raw material imports from 2005:Q1 to 2018:Q4 and employ a relatively recent econometric methodology, namely, Nonlinear Autoregressive Distributed Lag (NARDL) technique. The results confirm the existence of asymmetric impact of exchange rate in the long-run. The appreciation of currency has more pronounced impact in increasing imports relative to the depreciation of it in decreasing imports. There are further differences of this effect within imports across consumer goods, capital goods and raw materials. We present policy implications of this asymmetric effect of exchange rate on disaggregated consumer imports.

中文翻译：

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分类进口需求对汇率变动的不对称反应：一个小规模开放经济的视角

净进口国很容易受到其货币价值变化的影响。巴基斯坦作为一个小型开放经济体，经常项目和国际收支压力持续存在，这导致其汇率面临不可避免的压力。汇率变动直接影响进口成本，实证文献对此进行了广泛研究。然而，这些研究忽略了汇率不对称效应的可能性及其对巴基斯坦进口需求的影响。汇率升值对进口需求的影响可能与贬值不同，这取决于消费者偏好的刚性程度以及消费品、资本货物和原材料替代品的可用性。我们使用 2005 年以来巴基斯坦消费品、资本货物和原材料进口的季度数据：第一季度至 2018 年第四季度：采用相对较新的计量经济学方法，即非线性自回归分布式滞后 (NARDL) 技术。结果证实了汇率长期存在不对称影响。相对于货币贬值对进口减少的影响，货币升值对增加进口的影响更为显着。这种影响在消费品、资本货物和原材料的进口中存在进一步的差异。我们提出了汇率对分类消费品进口的这种不对称影响的政策含义。相对于货币贬值对进口减少的影响，货币升值对增加进口的影响更为显着。这种影响在消费品、资本货物和原材料的进口中存在进一步的差异。我们提出了汇率对分类消费品进口的这种不对称影响的政策含义。相对于货币贬值对进口减少的影响，货币升值对增加进口的影响更为显着。这种影响在消费品、资本货物和原材料的进口中存在进一步的差异。我们提出了汇率对分类消费品进口的这种不对称影响的政策含义。