Using multivariate cointegration tests for non-stationary data and vector error correction models, this paper examines the determinants of trade balance for Argentina over the last forty to fifty years. Our investigation confirms the existence of long-run relationships among trade balance, Real Exchange Rate (RER) and foreign and domestic incomes for Argentina during different real exchange rate management policies. Based on the estimations, the Marshall-Lerner condition is examined and, by means of impulse response functions, we trace the effect of a one-time shock to the RER on the trade balance checking the J-curve pattern.
This study examines the impact of trade on Cuban growth during different commercial policy regimes spanning the period from 1960 up to 2004, encompassing two essential economic structural transformations: the Cuban revolution and the fall of the Berlin Wall. For this purpose, the Granger causality is used by means of the modified Wald test for augmented-level vector autoregressive model with integrated and cointegrated processes introduced by Toda and Yamamoto (1995) and Dolado and Lutekepohl (1996). We show an import-led growth hypothesis during the Soviet-oriented pattern that is rejected after 1990, when exports are not only responsive to growth expansion but also to imports' behaviour.JEL classifications: C22, C32, C52, F31, F43.
This article addresses insights on Argentina's slowness growth performance throughout the period 1968 to 2003 and, especially, on its recent crisis in 2002. Using time series unit roots tests, vector auto-regresive models and cointegration tests, this study deals with the effect of the external sector constraint on Argentinean output expansion and, in particular, with the empirical validation of a variant of Thirlwall's Law. The results suggest that, in the long-run, there exists a stable relationship between economic growth, exports and even terms of trade. These findings allow us to conclude that Argentina's international payments position constraints its economic activity.
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