Exchange Rate Pass-Through (ERPT), commonly defined as the extent to which exchange rate changes are reflected in the price levels of an economy, has important implications in a number of policy-relevant areas. Despite this, estimates of ERPT in the Maltese economy are scarce and do not take...

The identification of a VAR requires differentiating between correlation and causation. This paper presents a method to deal with this problem. Graphical models, which provide a rigorous language to analyze the statistical and logical properties of causal relations, associate a particular set of...

In this study, we analyze the macroeconomic dynamics under various shocks in two competing frameworks. Given the baseline New-Keynesian model, we compare the impulse response functions that stem from the hybrid version under rational expectations with the ones obtained in the forward-looking...

This paper examines the endogenous interaction between labor costs and Foreign Direct Investment (FDI) in the OECD countries via the Panel VAR approach under system GMM estimates for the period 1995-2009. The available data allows identifying the relevance of the components of labor costs, and...

Maintaining a low rate of inflation and sustainable economic growth are at the core of monetary policymaking. Price stability is considered a condition for a healthy macroeconomic environment which promotes sustainable growth and a low rate of inflation is necessary to maintain stability in the...

Indirect inference testing can be carried out with a variety of auxiliary models. Asymptotically these different models make no difference. However, the small sample properties can differ. We explore small sample power and estimation bias both with different variable combinations and descriptive...

This study uses a six-variable vector autoregressive (VAR) model and analyses the relationship between defence spending as a percentage of GNP, government budget as a percentage of GNP, total deficit as a percentage of GNP, the GNP growth rates, inflation rates, and government budget deficit as...

The present study examines the dynamic interactions among macroeconomic variables such as real output, prices, money supply, interest rate and exchange rate in India during the pre-economic crisis and economic crisis periods, using the ARDL bounds test for cointegration, Johansen and Juselius...

The Moroccan economy relies heavily on remittances from abroad to the extent they are far more significant sources of income than others such as foreign direct investments and tourism. To assess the reliability of this external financing source by testing the resilience vis-à-vis the hosting...

Using several variants of a Marshallian Macroeconomic Model (MMM), see Zellner and Israilevich (2005) and Ngoie and Zellner (2012), this paper investigates how various tax rate reductions may help stimulate the U.S. economy while not adversely affecting aggregate U.S. debt. Variants of our MMM...