Contact Us

For Marketing, Sales and Subscriptions Inquiries
2637 E Atlantic Blvd #43110
Pompano Beach, FL 33062

Conference List

The Effects of Exchange Rate Liberalization in Kenya on French Beans Exports

Samuel Chege Mwangi


Oliver L.E. Mbatia


Jonathan Makau Nzuma

Samuel Chege Mwangi 1
Oliver L.E. Mbatia 2
Jonathan Makau Nzuma 3

  1. Department of Agricultural Economics,University of Nairobi, Nairobi, Kenya 1

  2. Department of Agricultural Economics,University of Nairobi, Nairobi, Kenya 2

  3. Department of Agricultural Economics, University of Nairobi, Nairobi, Kenya 3


The adoption of a floating exchange rate system in Kenya was an effort to make it more aligned to the market determined equilibrium rate. However, there is limited empirical evidence that success has since been achieved in realizing the objective for which the foreign exchange market was liberalized. The exports of French beans are one of the leading contributors to foreign exchange earnings in Kenya. Nevertheless, the economic impacts of exchange rate liberalization on French beans exports in Kenya are unclear. This paper evaluates the magnitude and direction of the effects of exchange rate liberalization on French beans exports from Kenya to its major trading partners in the European Union. Monthly data for a fixed exchange regime represented by the period from 1990-1993 and a flexible regime represented by the period from 1994-2011 was used in the estimation of an export demand model. The empirical results show that the liberalization of the exchange rate led to an increase in the French beans export volumes from Kenya to the European Union. The paper recommends that, even if the Kenyan exchange rate system is flexible, exchange rate stability is necessary to avoid adverse effects of exchange rate volatility on French beans exports. Therefore, stability of the exchange rate is needed, not at a fixed level but by controlling exchange rate volatility using the exchange rate target band.

Contribution/ Originality



  1. Adam, C., P. Collier and S. Ndung’u, 2010. Policies for prosperity. Kenya: Oxford University Press.
  2. Akaike, H., 1969. Fitting autoregressions for prediction. Annals of the Institute of Statistical Mathematics, 21(43): 243-247.
  3. Arize, A., T. Osang and D. Slottje, 2000. Exchange rate volatility and foreign trade: Evidence from thirteen LDC’s. Journal of Business and Economic Statistics, 18(1): 10-17.
  4. Banerjee, A., J. Dolado, J. Galbraith and D. Hendry, 1993. Co-integration, error correction and the econometric analysis of non-stationary data. New York: Oxford University Press.
  5. Chowdhury, A., 1993. Does exchange rate volatility depress trade flows? Evidence from error- correction model. Review of Economics and Statistics, 75(4): 700-706.
  6. Clark, P., N. Tamirisa and W. Shang-Jin, 2004. Exchange rate volatility and trade flows – some new evidence. International Monetary Fund.
  7. Cottani, J. and D. Cavallo, 1993. Financial reform and liberalization, in Dornbusch, R. (Ed), Policy making in the open economy: Concepts and case studies on economic performance. World Bank: Oxford University Press.
  8. Doroodian, K., 1999. Does exchange rate volatility deter international trade in developing countries? Journal of Asian Economics, 10(1999): 465-474.
  9. Enders, W., 2010. Applied econometric time series. 3rd Edn., John Wiley and Sons.
  10. Engle, R. and C. Granger, 1987. Co-integration and error correction: Representation, estimation and testing. Econometrica, 55(2): 251-276.
  11. Froot, K. and P. Klemperer, 1989. Exchange rate pass-through when market share matters. American Economic Review, 79(4): 637-654.
  12. Gertz, G., 2008. Kenya’s trade liberalization of the 1980s and 1990s: Policies, impacts, and implications, in background paper for the report on the impact of the Doha round on Kenya Published by Carnegie Endowment for International Peace.
  13. Ghura, D. and T. Grennes, 1993. The real exchange rate and macroeconomic performance in Sub-Saharan Africa. Journal of Development Economics, 42(1): 155-174.
  14. Goldstein, M. and M. Khan, 1978. The supply and demand for exports: A simultaneous approach. Review of Economics and Statistics, 60(2): 275-286.
  15. Horticultural Crops Development Authority, 2011. Horticultural crops development authority, Ministry of  Agriculture, Kenya. Horticulture Report, 2011.
  16. Johansen, S., 1988. Statistical analysis of cointegrating vectors. Journal of Economic Dynamics and Control, 12(2): 231-254.
  17. Johansen, S., 1991. Estimation and hypothesis testing of cointegrating vectors in gaussian vector autoregressive models. Econometrica, 59(6): 1551-1580.
  18. Johansen, S. and K. Juselius, 1990. Maximum likelihood estimation and inference on cointegration – with an application to the demand for money. Oxford Bulletin of Economics and Statistics, 52(2): 169-210.
  19. Learner, E. and R. Stern, 1970. Quantitative international economics. Journal of International Economics, 1(3): 359-361.
  20. Mackinnon, J., 1991. Critical values for cointegration tests. In R. F. Engle and C. W. Granger (Eds.), Long-run economic relationships: Readings in cointegration, Oxford University Press.
  21. Osterwald, L.M., 1992. A note with quantiles of the asymptotic distribution of the maximum likelihood cointegration rank test statistics. Oxford Bulletin of Economics and Statistics, 54(3): 461-472.
  22. Pugel, T., 2007. International economics. 13 Edn., McGraw-Hill International Edition.
  23. Sadoulet, E. and A.D. Janvry, 1995. Quantitative development policy analysis. Baltimore and London: The Johns Hopkins University Press.
  24. Sapir, A. and K. Sekkat, 1995. Exchange rate regimes and trade prices: Does the European monetary system matter? Journal of International Economics, 38(1): 75-94.
  25. World Bank, 2011. The state of Kenya’s economy. December, 2011 Report. Edition No 5.


Google Scholor ideas Microsoft Academic Search bing Google Scholor


Competing Interests:


Related Article

( 1 ) The Effects of Exchange Rate Liberalization in Kenya on French Beans Exports
( 2 ) Does the Mena Countries May Converge in GDP to Southern European One? The Effects of International Trade
( 3 ) Corruption’s and Democracy’s Effects on Economic Growth
( 4 ) Consideration the Effects of Water Sector Investment on Economic Growth in Iran
( 5 ) Effects of Advertising on Consumer Behavior in Low Density Houses: The Case of Marlborough, Zimbabwe
( 6 ) Moderating Effects of Project Management Experience, Project Team Size, Project Duration and Project Value Size on the Relationship between Project Manager’s Leadership Roles and Project Team Effectiveness in Malaysia
( 7 ) The Effects of Changes in Accounting Standards on Value Relevance of Financial Statement Information of Malaysia and Nigeria Banks
( 8 ) Organisational Politics – Causes and Effects on Organisation and Employees
( 9 ) Land Use/Land Cover Change and its Effects on Bamboo Forest in Benishangul Gumuz Region, Ethiopia
( 10 ) Effects of Environmental Satisfaction on Family Displacement Case Study: Gohar Dasht Region, Karaj City
( 11 ) Effects of Corporate Social Responsibility on Banks Financial Performance in Nigeria: A Study of United Bank of Africa
( 12 ) The Effects of Exchange Rate Variability on Trade Flows in Nigeria: A Cointegration Analysis
( 13 ) Analysis of the Effects of Pull and Push Factors on Brain Drain: An Example of Turkey
( 14 ) Effects of Socio-Cultural Diversity on the Performance of Private Health Care Organizations in Kogi State
( 15 ) Externality Effects of Sachet and Plastic Bottled Water Consumption on the Environment: Evidence from Benin City and Okada in Nigeria
( 16 ) Investigating the Environmental Effects of Economic Growth in African Economies
( 17 ) The Effects of Visual Merchandising and Price Sensitivity on Impulse Purchase Behaviour among Young Apparel Shoppers in Bangladesh
( 18 ) The Effects of Macroeconomic Variables on Bank Default: A Case Study in Brazil
( 19 ) Non-Linear Effects of Intellectual Property Rights on Technological Innovation: Evidence from Emerging and Developing Countries
( 20 ) The Effects of The Covid-19 Pandemic on Explotative and Explorative Strategies of Pharmaceutical Industries in Brazil
( 21 ) IT Governance as Drivers of Dynamic Capabilities to Gain Corporate Performance Under the Effects of Environmental Dynamism
( 22 ) Testing the Random Walks in Korea Stock Exchange
( 24 ) Exchange Rate Movements, Import And Economic Growth in Nigeria (1986-2010)
( 25 ) Impact of Food Beverage Price Index and Exchange Rate Volatility on Economic Growth
( 26 ) Testing the Random Walk: The Case of Hong Kong Stock Exchange
( 27 ) Role of Foreign Investment and External Debt in Determination of Exchange Rate
( 28 ) The Impact of the Global Financial Crisis on the Debt, Liquidity, Growth, and Volume of Companies in Palestine Stock Exchange
( 29 ) Studying the Integration of Damascus Securities Exchange with Selected Stock Markets
( 30 ) The Effect of Exchange Rate Changes on Consumer Prices in Nigeria: Evidence from VECM Model
( 31 ) Dynamics of Inflation, Economic Growth, Money Supply and Exchange Rate in India: Evidence from Multivariate Analysis
( 32 ) Implications of Crude Oil Price Volatility and Parallel Exchange Rate Fluctuation on the Cost of Living in Nigeria
( 33 ) Relevance of Stakeholders Theory, Organizational Identity Theory and Social Exchange Theory to Corporate Social Responsibility and Employees Performance in the Commercial Banks in Nigeria
( 35 ) The Profitability of Momentum Strategies: Empirical Evidence from Damascus Securities Exchange (DSE)
( 36 ) Exchange Rate and Foreign Reserves Interface: Empirical Evidence from Nigeria
( 37 ) Impact of Exchange Rate Fluctuation on Selected Economic Sectors of the Nigerian Economy
( 38 ) The Colonialists & Indigenous Exchange Currency: Tracing the Genesis of Socioeconomic Woes in Postcolonial Nigeria
( 39 ) The Transitional Relationship between Economic Growth and Exchange Rate in Ghana: An Empirical Approach
( 40 ) Determinants of Exchange Rate in Nigeria: A Comparison of the Official and Parallel Market Rates
( 41 ) Exchange Rate Pass-through to Prices: VAR Evidence for Albania
( 42 ) Issues of Unemployment in Nigeria: Effect of Real Exchange Rate and Inflation Interaction
( 43 ) Exchange Rate Volatility, Foreign Exchange Market Intervention and Asymmetric Preferences
( 44 ) An Agnostic Analysis of Exchange Rate Movement in Ghana
( 45 ) An Empirical Investigation of Real Exchange Rate Responses to Foreign Currency Inflows: Revisiting the Dutch Disease Phenomenon in South Asia
( 46 ) Factors Affecting the Individual Stock Price Index (IHSI) Industrial Manufacturing Sector in Indonesia, Automotive Sub Sectors, and Components in Indonesia Stock Exchange (IDX)
( 47 ) Management of The CFA Franc: What are the Fundamentals of the Real Exchange Rate in West African Economic and Monetary Union (WAEMU)?
( 48 ) Determinants of Profitability and its Implications on Corporate Values (Studies at Ceramic, Porcelain and Glass Sub Sector Listed in Indonesia Stock Exchange, 2009 - 2018)
( 49 ) Exchange Rate Volatility and Agricultural Commodity Prices i Nigeria (2000-2018)
( 50 ) The Impact of Data Frequency on the Level of Exchange Rate Pass-through to Consumer Prices in Nigeria
( 51 ) Financial Risks in Turkish Banking Industry: A Panel Data Analaysis on Istanbul Stock Exchange
( 52 ) Exchange Rate Fluctuations and the Performance of Nairobi Securities Exchange Market in Kenya During the Coronavirus Pandemic
( 53 ) A Study on Financial Performance of Transport & Warehouses Firms Listed on the Hanoi Stock Exchange
( 54 ) Importance of Corporate Governance Quality and Voluntary Disclosures of Corporate Governance Information in Listed Malaysian Family Controlled Businesses
( 55 ) Strategic Evaluation of Distributed Power Generation Technology: A Sustainable Approach
( 59 ) Rate of Return Would Not Increase To the Extent of Annuity Saving Discount
( 60 ) The Association Between Corporate Risk Disclosure and Firm Performance in Emerging Country – The Case of Egypt
( 61 ) A Model of Strategic Thinking: Islamic and Iranian Perspective
( 62 ) Promoting Local Acceptability of International Oil Companies (IOCS) Through Corporate Social Responsibility (CSR): The Case of Tullow Oil in Ghana
( 63 ) Challenges and Survival Strategies for Women in Small Scale Catering Business: A Case Study of Siyaso Magaba, Mbare
( 64 ) Attributes Influencing Strategic Alignment in the Service Sector: An Indonesian Banking Sector Case Study
( 66 ) The Role of Strategic Planning on the Management of Organizational Change
( 67 ) Development, Preference Change, and Inequality in an Integrated Walrasian-General-Equilibrium and Neoclassical-Growth Theory
( 68 ) Managerial Judgement Versus Financial Techniques in Strategic Investment Decisions: An Empirical Study on the Syrian Coastal Region Firms
( 69 ) Corporate Funding and Sustainability of Non- Governmental Organizations in Africa
( 73 ) Financial Deepening, Interest Rate Spread and Economic Growth: New Evidence from Sub-Sahara Africa
( 74 ) Implications of Accountants Unethical Behavior and Corporate Failures
( 79 ) The Moderating Effect of Governance Mechanisms on the Relationship Between Innovation Strategy and the Performance
( 80 ) Public-Private Partnership as a Strategy for E-Governance Funding in Africa: The Gains and the Pains
( 81 ) Does Gold Price Lead or Lags Islamic Stock Market and Strategy Commodity Price? A Study from Malaysia
( 83 ) Profitability of Commercial Bank on Interest Rate Deregulation
( 85 ) Migration as a Livelihood Strategy: The Case of Internal Migration in Ghana
( 86 ) Correlation between Financial Difficulties and Financing Strategies among Market Stallholders in Batangas City
( 87 ) Africa's Human Capital Development: Is Public Finance Management an Effective Strategy?
( 89 ) Determinants of Corporate Tax Avoidance Strategies among Multinational Corporations in Malaysia
( 90 ) The Effect of Corporate Social Responsibility Disclosure on Corporate Financial Performance