“…They illustrate a statistical relationship which tends to substantiate the concept of base theory that a dollar spent in the export industry causes factors of production to be employed which create a multiplier effect. The statistical relationship in this study is the strongest in one and two quarters which tends to support the short-run multiplier arguments found elsewhere in the literature (10,12,13,25,27,28). The results of this study are especially comparable with the short-run impacts found by Henry and Nyankori (12) and Sasaki (25).…”
Economic base theorists have long debated whether the economic base multiplier occurs rapidly in the short-run or requires a longer period to filter down. This paper provides further statistical evidence that the base multiplier is a short-run phenomenon. Spectral analysis and a cross-correlation function were used to compare two weighted activity indexes representing the basic industries and the nonbasic industries. The activity employment index representing the basic sector was found to lead the weighted payroll activity index for the nonbasic sector by one quarter. The employment index revealed a high cross-correlation when it lead a personal income index by two quarters. The results are important when considering the number of state and federal agencies which utilize an economic base analysis.
“…They illustrate a statistical relationship which tends to substantiate the concept of base theory that a dollar spent in the export industry causes factors of production to be employed which create a multiplier effect. The statistical relationship in this study is the strongest in one and two quarters which tends to support the short-run multiplier arguments found elsewhere in the literature (10,12,13,25,27,28). The results of this study are especially comparable with the short-run impacts found by Henry and Nyankori (12) and Sasaki (25).…”
Economic base theorists have long debated whether the economic base multiplier occurs rapidly in the short-run or requires a longer period to filter down. This paper provides further statistical evidence that the base multiplier is a short-run phenomenon. Spectral analysis and a cross-correlation function were used to compare two weighted activity indexes representing the basic industries and the nonbasic industries. The activity employment index representing the basic sector was found to lead the weighted payroll activity index for the nonbasic sector by one quarter. The employment index revealed a high cross-correlation when it lead a personal income index by two quarters. The results are important when considering the number of state and federal agencies which utilize an economic base analysis.
“…Other ideas are to apply a transfer function [Cook (1979)] or to use time series techniques [Sasaki (1963); Spreen and Mulkey (1980); Giarratani and McNelis (1980)]. The most ambitious approach, which avoids an arbitrary lag structure, is by Henry and Nyankori (1981). They use a linear spline function to evaluate impacts quarter by quarter within an overall assumed lag response of two years.…”
Section: A the Lag Distribution Of Multiplier Impactsmentioning
“…Other studies employed monthly or quarterly time-series data to test for short-run and long-run multipliers (Henry and Nyankori, 1981;Spreen and Mulkey, 1980;Lego et al, 2000;Harris et al, 1999). With time-series models, cointegration is applied to test for long-run relationships between variables such as basic and nonbasic employment or income.…”
Section: Stability Of Basic and Nonbasic Multipliers Over Timementioning
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