|
|
|
|
Title: |
A Reassessment of Balance of Payments
Constrained Growth: Results from Panel Unit Root and Panel Cointegration
Tests |
| Author: |
Christopoulos,
Dimitris K.; Tsionas, Efthymios G. |
| Author
Affiliation: |
Panteion U;
Athens U Econ and Business |
| Source: |
International Economic Journal, Autumn 2003, v. 17, no. 3, pp. 39-54 |
|
Publication Date: |
Autumn 2003 |
|
Abstract: |
The paper
reassesses the empirical evidence for Thirlwall's law in seven
industrial countries by using panel unit root and panel cointegration
tests including Johansen maximum likelihood cointegration tests. Current
practice restricts attention to time series residual based cointegration
tests, which are known to have low power and are subject to
normalization problems. Since economic time series are typically short,
it is desirable to exploit panel data in order to draw sharper
inferences. The empirical results reveal that imports are cointegrated
with terms of trade and income (although residual-based tests indicate
the opposite). We find that, with the exception of Australia,
Thirlwall's law holds. |
|
