Asymmetric Effects of Exchange Rate Changes on Thailand-China Commodity Trade: Evidence From 45 Industries

China is now Thailand's largest trading partner and 15% of Thailand's total trade with the world belongs to China. A previous study that assessed the asymmetric effects of the real baht-yuan rate on the bilateral trade balance between the two countries found that a real depreciation of the baht against Yuan has a worsening effect in the long run. We disaggregate the two countries' trade by industry and consider trade balance of each of the 45 industries that trade between Thailand and China. When we estimated a linear model, we found no favorable effects of baht depreciation in any industry. However, when a nonlinear model was estimated, we found significant short-run cumulative or impact asymmetric effects in 27 industries and significant long-run asymmetric effects in 15 industries. Additional analysis revealed that four industries will benefit from baht depreciation and six will be hurt from baht appreciation, supporting a new definition of the asymmetric J-curve in a total of 10 industries.