I'm not the OP, but as far as I know there is no economic faction which disputes the claim that "a weak currency boosts exports."

I spent 5 minutes googling this out of curiosity and could only find published claims in favor of the orthodox "weak currency boosts exports" idea, for example "Export dependent nations may actively encourage a weak currency in order to boost their exports." [0] or "Exports become cheaper when the currency of a nation is weak."[1]

[0] https://www.investopedia.com/terms/s/weak-currency.asp [1] https://thebusinessprofessor.com/en_US/economic-analysis-mon...

If there are published claims to the contrary, I would be interested in reading them.

Pay your workers in cheap local currency, sell in strong foreign currency.

So how does a cheap currency benefit Germany according to this theory?

Another thing is that if production costs go down (although you don't say why they're going down, it seems a random assumption on your part), then competition among exporters will drive the price of exports down. I mean, this is Economics 101.

So, this only works if a large part of the cost is labor (this is the model china used in the last few decades) in which case the cost of production definitely goes down. I'm no expert in Germany's economy, maybe they have more materials / energy cost that they need to pay for in their home currency?

Your analysis is incorrect. Markup is a function of market power. If market power remains the same, an increase in markup cannot last for long. Competition will drive prices down until markup goes back to its previous level. Therefore the end result is a fall in the price of exports. Whereas for importers the opposite is true, imports become more expensive for local purchasers. This is what is meant by "selling cheap and buying expensive", which is exactly what happens when a currency depreciates.

It also means you're paying your labor cheap. That makes you more competitive.

But competitive simply means your products sell for less. The question was how does selling for less and buying for more benefit you?

You don't sell for less, since you sell in foreign currency. So you get the same amount of foreign currency (price in USD remains the same), but you need less converted to your internal currency to pay your labor.

But then you can invest that extra profit in decreasing your foreign currency price, thus becoming more competitive.

You can google for longer explanations of why a weak currency is excellent for exporters, this is well established.

I just Googled it, and this is what I found [1]:

When a country's currency appreciates in relation to foreign currencies, foreign goods become cheaper in the domestic market and there is overall downward pressure on domestic prices. In contrast, the prices of domestic goods paid by foreigners go up, which tends to decrease foreign demand for domestic products.

A depreciation of the home currency has the opposite effects.

It contradicts directly your claim that exports don't get cheaper. You're saying exports remain the same (because they don't get any cheaper), and that the only change is an increase of corporate profits at the expense of wages.

[1] https://en.wikipedia.org/wiki/Currency_appreciation_and_depr...

Read again carefully what you quoted. It exactly supports my claim.

> Export dependent nations may actively encourage a weak currency in order to boost their exports.

> A weak currency may help a country's exports gain market share when its goods are less expensive compared to goods priced in stronger currencies. The increase in sales may boost economic growth and jobs while increasing profits for companies conducting business in foreign markets

https://www.investopedia.com/terms/s/weak-currency.asp

Do you read your own quotes?

Where does it support your claim that a weakened currency does not affect the price of exports?

It says the exact opposite. Exports increase because they become less expensive:

> A weak currency may help a country's exports gain market share when its goods are less expensive compared to goods priced in stronger currencies. The increase in sales may boost economic growth and jobs while increasing profits for companies conducting business in foreign markets

The person you are arguing with said this:

>But then you can invest that extra profit in decreasing your foreign currency price, thus becoming more competitive.

Yeah, which is baffling. It's not possible to invest in decreasing your foreign currency price. Price is an exogenous variable in a competitive market. You can invest in the production process so that production becomes more cost-effective and this allows you to lower prices, but that has nothing to do with devaluations, and certainly is not the mechanism through which exports prices fall when a currency depreciates.