scholarly journals Effect of Climate Change on Agricultural Output Growth in Ethiopia: Co-Integration and Vector Error Correction Model Analysis

2019 ◽  
Vol 1 (4) ◽  
pp. 132-143
Author(s):  
Melaku Adinew Aytehgiza ◽  
Gebrekirstos Gebresilasie
Keyword(s):  
Climate Change ◽  
Carbon Dioxide ◽  
Output Growth ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Agricultural Output ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run

This study examined the effect of climate change on agricultural output growth in Ethiopia. Co- Integration and Vector Error Correction Model estimation technique and data for the period 1981-2016 was used. Changing in annual mean temperature, annual mean rainfall, carbon dioxide emission and forest depletion were used to attribute variables for climate change. The result of vector error correction model indicate that both in the long-run and short-run, carbon dioxide emissions negatively affect agricultural output growth in Ethiopia. Annual temperature and annual rainfall negatively affect agricultural output growth in the long run and short run respectively.  On the other hand, forest depletion has positive effect on agricultural output growth both long run and the short-run respectively. Policy maker should develop policies to reduce sources of carbon dioxide emissions and introduce mitigation and adaptation measures to sustain the agricultural economic growth.  

scholarly journals An Econometric Analysis of Inflation and Unemployment in Lebanon: A Vector Error Correction Model (VECM)

2018 ◽  
Vol 10 (2) ◽  
pp. 133
Author(s):  
Mohammad Khanssa ◽  
Wafaa Nasser ◽  
Abbas Mourad
Keyword(s):  
Phillips Curve ◽  
Vector Error Correction Model ◽  
Econometric Modeling ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Causality Relationship ◽  
The Relationship

This paper uses econometric modeling to test the nature of the relationship between unemployment and inflation in Lebanon throughout the period 1993-2014. It takes the Phillips curve relationship as a reference for the tests. Cointegration, Granger causality and VECM were used to test the relationship both in the short and in the long run. The study resulted in finding out that the Phillips curve relationship doesn’t hold in Lebanon in the short run and came to a conclusion that there is a one-way causality relationship in the long run from unemployment to inflation and not in the opposite direction.

scholarly journals REVISITING KEYNES’ INVESTMENT AND SAVING MODEL IN INDONESIA

2020 ◽  
Vol XVIII (2) ◽  
pp. 45-58
Keyword(s):  
Error Correction ◽  
Causal Relationship ◽  
Granger Causality Test ◽  
Vector Error Correction Model ◽  
Causality Test ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run

This study aims to analyze the Keynes’ investment and saving model in Indonesia from 1981 to 2018. The researchers use the econometric test from the Granger causality test to find the short-run causal relationship and the Vector Error Correction Model to reveal both the short-run and long-run effects in the model. The result of Granger causality test demonstrates that there is no short-run causal relationship between these two variables. In the short-run, the increase in saving affects the consumption loans more compared to the investment loans. Besides, increased consumption compared to saving has more influence in raising investment. However, the Vector Error Correction Model proves that saving negatively affects investment in the long-run. This model empirically supports the long-run Keynes’ investment and saving model. Consequently, the Indonesian government needs to consider saving as a policy instrument to increase investment in the longrun.

scholarly journals Free Trade: Does Myopic Policy Overlook Long-Term Gains?

2017 ◽  
Vol 22 (2) ◽  
pp. 65-88
Author(s):  
Maryiam Haroon
Keyword(s):  
Trade Liberalization ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Myopic Policy ◽  
The Relationship

This article analyzes the correlation between trade liberalization and welfare in Pakistan from 1986 to 2015. Using consumption expenditure as a measure of welfare, we estimate the relationship using a vector error correction model. The empirical results show that trade liberalization does not have an immediate correlation with welfare: it takes some time for liberalization policies to enhance welfare. The findings also suggest that trade liberalization can help reduce poverty, decrease inequality and increase enrollment levels in the long run. But in the short run, trade liberalization has led to higher income inequality.

scholarly journals Socially Responsible Investment And Macroeconomic Stability In South Africa: An Application Of Vector Error Correction Model

2013 ◽  
Vol 29 (6) ◽  
pp. 1623 ◽  
Author(s):  
Paul F. Muzindutsi ◽  
Tshediso J. Sekhampu
Keyword(s):  
Interest Rates ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Responsible Investment ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
The Relationship ◽  
Macroeconomic Stability

<p>The study reported in this article investigated the relationship between the Social Responsible Investment (SRI) sector and macroeconomic stability in South Africa. Johansen co-integration approach and Vector Error Correction Model (VECM) were employed to test the relationship between SRI Index and a set of macroeconomic stability variables (inflation, real exchange rate, interest rates and money supply). Secondary data for the period April 2004 to December 2012 was analysed. There was a long-run association between all the variables during the period under consideration. However, the inflation rate, real effective exchange rate and money supply were not significant in predicting short-run changes in the SRI Index. A significant short-run relationship between SRI Index and the difference between long term and short-term interest rates (term structure) was observed. Macroeconomic variables are significant in explaining the behavior of the South African SRI sector in the long-run.</p>

Co-integration Between Sensex and Other Popular Indices: A Decadal Study

2019 ◽  
Vol 8 (2) ◽  
pp. 108-117
Author(s):  
Parul Bhatia ◽  
Hemalatha Ramasubramanian
Keyword(s):  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
World Markets ◽  
The World ◽  
Integration Techniques ◽  
The Usa ◽  
Short Run

We examine the inter-relationship between India, the USA, Japan, China, France, Dubai and Germany using multivariate co-integration techniques. The study has investigated co-movements between these world indices from 2009 to 2018. During this period, it was found using Johansen co-integration that these indices were co-integrated in the long run. However, in the vector error correction model, long-run causality could not be found. Thereafter with Wald-χ2 diagnostics, it was found that short-run linkages existed among Indian and rest of the world markets in the study. Therefore, the seven indices may be concluded to have causal relationship in the short run and co-integrating association in the long run.

scholarly journals Assessment of cassava supply response in Nigeria using vector error correction model (VECM)

Agricultura ◽  
2016 ◽  
Vol 13 (1-2) ◽  
pp. 79-86
Author(s):  
Oluwakemi Adeola Obayelu ◽  
Samuel Ebute
Keyword(s):  
Error Correction ◽  
Error Correction Model ◽  
Vector Error Correction Model ◽  
Agricultural Commodities ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Cassava Production

Abstract The response of agricultural commodities to changes in price is an important factor in the success of any reform programme in agricultural sector of Nigeria. The producers of traditional agricultural commodities, such as cassava, face the world market directly. Consequently, the producer price of cassava has become unstable, which is a disincentive for both its production and trade. This study investigated cassava supply response to changes in price. Data collected from FAOSTAT from 1966 to 2010 were analysed using Vector Error Correction Model (VECM) approach. The results of the VECM for the estimation of short run adjustment of the variables toward their long run relationship showed a linear deterministic trend in the data and that Area cultivated and own prices jointly explained 74% and 63% of the variation in the Nigeria cassava output in the short run and long-run respectively. Cassava prices (P<0.001) and land cultivated (P<0.1) had positive influence on cassava supply in the short-run. The short-run price elasticity was 0.38 indicating that price policies were effective in the short-run promotion of cassava production in Nigeria. However, in the long-run elasticity cassava was not responsive to price incentives significantly. This suggests that price policies are not effective in the long-run promotion of cassava production in the country owing to instability in governance and government policies.

scholarly journals Determinants of Agricultural Productivity in India: An Econometric Analysis

2018 ◽  
Vol 4 (02) ◽  
Author(s):  
Biswashree Tanaya Priyadarsini ◽  
Chittaranjan Nayak
Keyword(s):  
Agricultural Sector ◽  
Agricultural Productivity ◽  
Private Investment ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Specific Support ◽  
Short Run

The main aim of this paper is to examine both short run and long run effects of various factors on agricultural productivity in India. The present study used the annual time series data covering the time period from 1980 to 2013. Johansen cointegration and vector error correction model are adopted in order to examine the objective of the study. The study has analysed the relative effectiveness of various factors like Irrigation (PGIA), Fertilizer (FERT), Electricity (ELCT), Private investment in agriculture (PII) and Non-product specific support to inputs (NPSS) on agricultural productivity. The cointegration results suggest that there is a long run equilibrium relationship between all the determinants and agricultural productivity. The vector error correction model indicates that there is long run causality running from PGIA, FERT, NPSS, ELCT, and PII to Productivity meaning that all the factors have significant influence on productivity in long run. However, as regards short run, only PGIA and PII have significant impact on agricultural productivity. The study suggests that the government should take initiative for non-product specific support to major inputs like organic fertilizer, power and irrigation and also promote private investment in agricultural sector to enhance agricultural productivity which will go a long way in development of agricultural sector.

scholarly journals PENGARUH VARIABEL MAKRO EKONOMI DAN PENYALURAN ZAKAT, INFAK, DAN SEDEKAH OLEH BADAN AMIL ZAKAT NASIONAL TERHADAP KEMISKINAN DI INDONESIA

2020 ◽  
Vol 6 (7) ◽  
pp. 1476
Author(s):  
Jasmine Fitri Andrini ◽  
Ilmiawan Auwalin
Keyword(s):  
Gross Domestic Product ◽  
Domestic Product ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Negative Effect ◽  
Short Run ◽  
Model Technique

This research aims to know the effect of macroeconomics variable, such as Gross Domestic Product (GDP), unemployment, inflation, and gini ratio and distribution of Zakat, Infaq, and Sodaqoh (ZIS) from National Zakat Agency against poverty in Indonesia during 2007 to 2017 simultaneously and partially in long run and short run. This study used vector error correction model technique. The result of this research indicates that GDP, inflation, gini ratio, and distribution of ZIS partially have a negative and significant effect to poverty in long run. Meanwhile, unemployment partially has a positive and significant effect to poverty in long run. In short run, GDP, inflation and distribution of ZIS partially have a negative and not significant effect to poverty, unemployment has a positive insignificant effect to poverty. Meanwhile, gini ratio partially has a significant and negative effect to poverty. Simultaneoosly, all variables affect poverty.Keywords: Gross Domestic Product (GDP), Unemployment, Inflation, Gini ratio, Zakat Infaq Sodaqoh (ZIS), Poverty

Enhancing Economic Growth and Government Revenue Generation in Nigeria: The Role of Diaspora Remittances

2021 ◽  
pp. 003464462110256
Author(s):  
Dal Didia ◽  
Suleiman Tahir
Keyword(s):  
Economic Growth ◽  
Parameter Estimates ◽  
Gross Domestic Product Growth ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
The Empirical Analysis

Even though remittances constitute the second-largest source of foreign exchange for Nigeria, with a $24 billion inflow in 2018, its impact on economic growth remains unclear. This study, therefore, examined the short-run and long-run impact of remittances on the economic growth of Nigeria using the vector error correction model. Utilizing World Bank data covering 1990–2018, the empirical analysis revealed that remittances hurt economic growth in the short run while having no impact on economic growth in the long run. Our parameter estimates indicate that a 1% increase in remittances would result in a 0.9% decrease in the gross domestic product growth rate in the short run. One policy implication of this study is that Nigeria needs to devise policies and interventions that minimize the emigration of skilled professionals rather than depending on remittances that do not offset the losses to the economy due to brain drain.

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