Abstract. This paper investigates the causal relationship between asset prices and per capita output across 50 US states and the District of Columbia over 1975 to 2012. A bootstrap panel Granger causality approach is applied on a trivariate VAR comprising of real house prices, real stock prices and real per capita personal income (proxying output), which allows us to account not only for heterogeneity and cross-sectional dependence, but also for interdependency between the two asset markets. Empirical results reveal the existence of a unidirectional causality running from both asset prices to output. This confirms the leading indicator property of asset prices for the real economy, while also substantiating the wealth and/or collateral transmission mechanism. Moreover, the absence of reverse causation from the personal income per capita to both housing and stock prices tend to suggest that noneconomic fundamentals may have played an important role in the formation of bubbles in these markets.
Th ere is a growing consensus that food security is vital to the general wellbeing of any economy, but a far less consensus on whether food security can spur economic growth in a country. Many economic growth strategies focus on specifi c interventions (trade openness index, tropical climatic variables, working age population share etc.), but many factors, such as food availability, female education and health outcomes, can potentially have a profound infl uence on economic growth. To explore this hypothesis more systematically, this paper employs a rich cross-country dataset of 124 countries to examine the impact of food security, using food availability as a proxy on economic growth. Th is paper examines the impact of food shortages on African economic growth rates. It does so by extending the Barro growth model to include food availability as a right hand-side variable and by distinguishing African countries with food shortages from others. Based on the cross-country regressions results, the paper concludes that the improved food availability indeed contributes to the improved economic growth in general, as well as in Africa.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.