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The cost of adjustment: On comovement between the trade balance and the terms of trade

Dmitriev, Alexandre; Roberts, Ivan - In: Economic Modelling 35 (2013) C, pp. 689-700

The S-shaped cross-correlation function between the trade balance and the terms of trade has been documented for several countries and time frames. The ability of two-country, two-good business cycle models to reproduce this regularity hinges on the dynamics of capital formation. We consider the...

Persistent link: https://www.econbiz.de/10011048821

The Feldstein–Horioka Puzzle and structural breaks: Evidence from EU members

Ketenci, Natalya - In: Economic Modelling 29 (2012) 2, pp. 262-270

cointegration relationships between investment and saving flows of European Union members three different cointegration techniques … were applied to the data. Firstly, the Johansen (1988) cointegration approach was used for the case of no cointegration … shifts, then the Gregory and Hansen (1996) cointegration test was applied, which allows for one structural shift. Finally …

Persistent link: https://www.econbiz.de/10010577067

Remittances flow and financial development in Bangladesh

Chowdhury, Mamta B. - In: Economic Modelling 28 (2011) 6, pp. 2600-2608

Workers' remittance is a major source of foreign exchange earnings and plays an important role in the economy of Bangladesh. It accounts for 12% of GDP in 2010. This paper examines with annual data for 1971–2008, whether the flow of remittances is contributing positively to the development of...

Persistent link: https://www.econbiz.de/10010577124

Integration of current account imbalances in the OECD

Narayan, Seema - In: Economic Modelling 38 (2014) C, pp. 288-295

The Glick and Rogoff (1995) hypothesis suggests that common or global shocks do not influence current accounts of countries which are symmetric. This is tested for 37 pairs of current account imbalances out of 17 OECD countries. Using time series data that spans the pre-Global crisis period but...

Persistent link: https://www.econbiz.de/10010753327

Long-run determinants of current accounts in OECD countries: Lessons for intra-European imbalances

Gossé, Jean-Baptiste; Serranito, Francisco - In: Economic Modelling 38 (2014) C, pp. 451-462

In this paper we study the long-run determinants of current account balances in 21 OECD countries. We define long-run targets to determine whether actual current account balances are in line with their equilibrium values and find that, following the crisis, the United States, Japan and Spain...

Persistent link: https://www.econbiz.de/10010753347

Optimal exchange rate policy for a small oil-exporting country: A dynamic general equilibrium perspective

Al-Abri, Almukhtar Saif - In: Economic Modelling 36 (2014) C, pp. 88-98

This paper examines the choice of optimal exchange rate regime for an oil-exporting small open economy using a welfare-based model. The paper extends the standard New Keynesian Small Open Economy model to include three countries: a small oil-exporting country and two large foreign countries. The...

Persistent link: https://www.econbiz.de/10010729808

Has Australia's floating exchange rate regime been optimal?

Makin, Anthony J.; Rohde, Nicholas - In: Economic Modelling 29 (2012) 4, pp. 1338-1343

This paper develops a straightforward theoretical framework for evaluating exchange rate regime choice for small economies. It proposes that a floating exchange rate minimises national income and employment variation when real macroeconomic shocks predominate, whereas a pegged exchange rate...

Persistent link: https://www.econbiz.de/10010573264

Evaluating the carbon-macroeconomy relationship: Evidence from threshold vector error-correction and Markov-switching VAR models

Chevallier, Julien - In: Economic Modelling 28 (2011) 6, pp. 2634-2656

This paper studies the nonlinear adjustment between industrial production and carbon prices – coined as ‘the carbon-macroeconomy relationship’ – in the EU 27. We model carbon price returns and industrial production as nonlinear and state-dependent, with dynamics depending on the sign and...

Persistent link: https://www.econbiz.de/10010577077

Application of factor models for the identification of countries sharing international reference-cycles

Santos, Sonia de Lucas; Rodríguez, María Jesús Delgado; … - In: Economic Modelling 28 (2011) 6, pp. 2424-2431

Using the methodology developed in Stock and Watson (2002a), this paper proposes to exploit the information that contains the factor loading to identify the countries sharing common factors. The proposal is illustrated by analyzing the relation with the international reference-cycle of a large...

Persistent link: https://www.econbiz.de/10011048707

Investment-specific shocks and real business cycles in emerging economies: Evidence from Brazil

Araújo, Eurilton - In: Economic Modelling 29 (2012) 3, pp. 671-678

This paper investigates the role of the RBC (Real Business Cycle) model with investment-specific technology shocks in explaining business cycle fluctuations in Brazil. I consider the role of transitory and permanent components of neutral and investment-specific technology shocks. I fit the model...

Persistent link: https://www.econbiz.de/10011048830