【正文】 explain the observed trade balances in Malaysia, Singapore, Thailand and the Philippines during the period of study, with respect to Japan. The rest of this paper is outlined as follows. Section II describes the empirical data of this study. Section III examines the exchange ratetrade balance relationship between ASEAN5 countries and Japan. The mathematical derivation of the real money effect proposition is presented in Section IV. Section V provides empirical evidence of our proposition and the final section concludes this study. II. EMPIRICAL DATA OF STUDY This study examines the relationship between exchange rate and trade balance in the context of ASEAN5 economies with respect to Japan, one of their major trading partners. The end of period nominal exchange rates for the countries involved, namely Indonesia (IDR), Japan (JPY), Malaysia (MYR), the Philippines (PHP), Singapore (SGD) and Thailand (THB) are collected from various issues of International Financial Statistics (IMF). Our trade balance data is constructed by subtracting imports payment from exports earning, both of which are obtained from Direction of Trade Statistics Yearbook (IMF), with a sample period spanning from 1986 to 1999. The choice of sample period is based on the availability of imports and exports data at the time of study. Besides, Consumer Price Indices (CPI) for these countries, which are utilised to estimate the equilibrium exchange rate suggested by the purchasing power parity (PPP) hypothesis, are collected from International Financial Statistics. In this study, nominal bilateral exchange rate is defined as the foreign price of domestic currency. For example, the JPY/MYR exchange rate refers to the unit price of Malaysia ringgit (MYR) in terms of Japanese yen (JPY). The Japanese yenbased nominal bilateral exchange rates of these ASEAN5 economies, together with their corresponding longterm trends are plotted in Figure 1. A stylised fact depicted in these plots is that, in the period of study, the nominal exchange rates of these ASEAN5 economies depreciate with respect to Japanese yen (JPY). This is obvious 4 from the downwardssloping longterm trend of each nominal bilateral exchange rate. The depreciation of ASEAN5 exchange rates in the period of study is mainly due to the appreciation of Japanese yen with respect to the . dollar, whereas during the same period, the US denominated ASEAN5 exchange rates either remain stable or depreciate. The plots of trade balances of ASEAN5 economies with respect to their major trading partner Japan are shown in Figure 2. The Malaysian trade balance generally deteriorates from 1986 to 1995, and from then it improves until 1999, the end period of this study. Similar stylised trend is clearly observed in the case of the Philippines, Singapore and Thailand, with the exception of Indonesian trade balance, in which the trend is less obvious. III. EXCHANGE RATETRADE BALANCE RELATIONSHIP The elasticity model of the balance of trade (Krueger, 1983) has shown the existence of a theoretical relationship between exchange rate and the trade balance. Generally, the nominal depreciation (appreciation) of exchange rate is assumed to change the real exchange rate (see for instance, Himarios, 1989。 同時(shí)，對(duì) 東盟 5 國(guó) 貿(mào)易 的 采樣周期 的 選擇 的 另一解釋 也 已被假定。 其中 已經(jīng)引起了研究人員關(guān)注的領(lǐng)域之一是 匯率變動(dòng)與貿(mào)易 平衡 的 關(guān)系 。 Buluswar et al., 1996。 在理論上，名義匯率貶值（升值）是假定實(shí)際匯率的變化（見(jiàn)，例如， Himarios， 1989。不過(guò)，從匯率和這些東盟 5國(guó) 的貿(mào)易平衡的情 況來(lái)看 ，似乎匯率的變化 對(duì) 貿(mào)易平衡的作用被夸大了。特別是，假定貿(mào)易平衡是受 實(shí)際有效匯率 的影響 而不是名義匯率 。此外，這些國(guó)家的消費(fèi)者價(jià)格指數(shù)（ CPI）， 即 用來(lái)估計(jì)均衡匯率所 提出 的購(gòu)買力平價(jià)（ PPP）的假說(shuō)，是從國(guó)際金融統(tǒng)計(jì) 中 收集 的 。 1986 年至 1995年 ， 馬來(lái)西亞一般貿(mào)易平衡惡化 ，而此后 一 直到 1999 年 即 這項(xiàng)研究的末期 均 得到改善 。然而，從我們 所得到 的匯率（圖 1）和貿(mào)易平衡（圖 2） 來(lái)看 ，東盟 5 國(guó) 匯率貶值（圖 1， 長(zhǎng)期的傾斜趨勢(shì)） 對(duì) 雙邊貿(mào)易平衡 的 影響，是令人驚訝的相反。 Mahdavi and Sohrabian, 1993。這是因?yàn)橘Q(mào)易平衡 基于 對(duì)外國(guó)商品 與 國(guó)內(nèi)商品的 需求而定，而這些需求 則 取決于國(guó)外國(guó)內(nèi)價(jià)格比。 而 另一種解釋東盟 5 國(guó) 抽選的樣本期間所觀察到的假設(shè)行為已經(jīng)表明，貿(mào)易平衡是受 實(shí)際有效匯率 的影響 而不是名義匯率。因此，為了應(yīng)對(duì)貿(mào)易赤字，這些東盟國(guó)家的政府可能采取的政策措施 的重點(diǎn) 變量 是 實(shí)際貨幣 與名 義貨幣價(jià)格水平 之 比。