Trade Linkages and Output-Multiplier Effects: A Structural VAR
This paper develops a structural VAR model to measure how a shock to one country can affect the GDP of other countries. It uses trade linkages to estimate the multiplier effects of a shock as it is transmitted through other countries�...
| Huvudupphovsmän: | , |
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| Språk: | en_US |
| Publicerad: |
2002
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| Ämnen: | |
| Länkar: | http://hdl.handle.net/1721.1/669 |
| _version_ | 1826210708502609920 |
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| author | Forbes, Kristin J. Abeysinghe, Tilak |
| author_facet | Forbes, Kristin J. Abeysinghe, Tilak |
| author_sort | Forbes, Kristin J. |
| collection | MIT |
| description | This paper develops a structural VAR model to measure how a shock to one country
can affect the GDP of other countries. It uses trade linkages to estimate the multiplier
effects of a shock as it is transmitted through other countries' output fluctuations. The
paper introduces a new specification strategy that significantly reduces the number of
unknowns and allows cross-country relationships to vary over time. Then it uses this
model to examine the impact of shocks to 11 Asian countries, the U.S. and the rest of
the OECD. The model produces reasonably good short-term forecasts.
Impulse-response matrices suggest that these multiplier effects are large and significant
and can transmit shocks in very different patterns than predicted from a bilateral-trade
matrix. For example, due to these output-multiplier effects, a shock to one country can
have a large impact on countries that are relatively minor bilateral trading partners. |
| first_indexed | 2024-09-23T14:53:54Z |
| id | mit-1721.1/669 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T14:53:54Z |
| publishDate | 2002 |
| record_format | dspace |
| spelling | mit-1721.1/6692019-04-12T08:22:47Z Trade Linkages and Output-Multiplier Effects: A Structural VAR Forbes, Kristin J. Abeysinghe, Tilak Output-Multiplier Effects VAR Trade linkages This paper develops a structural VAR model to measure how a shock to one country can affect the GDP of other countries. It uses trade linkages to estimate the multiplier effects of a shock as it is transmitted through other countries' output fluctuations. The paper introduces a new specification strategy that significantly reduces the number of unknowns and allows cross-country relationships to vary over time. Then it uses this model to examine the impact of shocks to 11 Asian countries, the U.S. and the rest of the OECD. The model produces reasonably good short-term forecasts. Impulse-response matrices suggest that these multiplier effects are large and significant and can transmit shocks in very different patterns than predicted from a bilateral-trade matrix. For example, due to these output-multiplier effects, a shock to one country can have a large impact on countries that are relatively minor bilateral trading partners. 2002-06-05T20:40:52Z 2002-06-05T20:40:52Z 2002-06-05T20:41:01Z http://hdl.handle.net/1721.1/669 en_US MIT Sloan School of Management Working Paper;4242-01 378711 bytes application/pdf application/pdf |
| spellingShingle | Output-Multiplier Effects VAR Trade linkages Forbes, Kristin J. Abeysinghe, Tilak Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title | Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title_full | Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title_fullStr | Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title_full_unstemmed | Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title_short | Trade Linkages and Output-Multiplier Effects: A Structural VAR |
| title_sort | trade linkages and output multiplier effects a structural var |
| topic | Output-Multiplier Effects VAR Trade linkages |
| url | http://hdl.handle.net/1721.1/669 |
| work_keys_str_mv | AT forbeskristinj tradelinkagesandoutputmultipliereffectsastructuralvar AT abeysinghetilak tradelinkagesandoutputmultipliereffectsastructuralvar |