Effects of Real Exchange Rate on Trade Balance in Cote d’Ivoire: Evidence from Threshold Nonlinear ARDL Model

The objective of this paper is to shed new light on the nonlinear relationship between real exchange rate changes and trade balance in Cote d’Ivoire. In examining issue, previous studies have relied autoregressive distributed lag model developed by Shin et al. (2014) where decomposed into partial sum positive negative changes. They fail examine response extreme rate. order investigate possible sign size-dependence rate, study uses multiple threshold ARDL modeling. approach implemented using annual data covering period 1975-2017. results reveal that effects are asymmetric both time horizons. More specifically, appreciations deteriorate while depreciations improve it. Further, effect large higher when compared with appreciations.