Durante décadas, la violencia ha afectado el desarrollo económico, político y social de Colombia.... more Durante décadas, la violencia ha afectado el desarrollo económico, político y social de Colombia. En este trabajo evaluamos los efectos de los delitos violentos contra las personas y la propiedad privada sobre el comportamiento de la inversión neta de la industria manufacturera en los departamentos de Colombia durante el período 2000-2013. Este trabajo se basa en los modelos propuestos por Acevedo y Mora (2009) y Acevedo y García (2015) y emplea información estadística de la Encuesta Anual de Manufactura y diversas formas de violencia (secuestros, robos y homicidios) obtenidas de la base de datos de la Revista Criminalidad para los 32 departamentos y Bogotá, D. C. Para ello se emplea un modelo de datos panel y se usa la bondad del ajuste como criterio para seleccionar los modelos que mejor se ajustan a los datos. La evidencia empírica muestra que la violencia medida por el número de secuestros, más que los homicidios y robos, es el fenómeno que más ha afectado la inversión en Colomb...
El presente estudio prueba la existencia de causalidad, en el sentido de Granger, y la dirección ... more El presente estudio prueba la existencia de causalidad, en el sentido de Granger, y la dirección de la misma entre el Producto Interno Bruto real, exportaciones, importaciones y la Inversión Extranjera Directa (FDI) para el caso de México. El análisis aplica tanto la metodología ...
Este escrito analiza la hipótesis de convergencia y el impacto de las políticas sociales en el cr... more Este escrito analiza la hipótesis de convergencia y el impacto de las políticas sociales en el crecimiento económico de los seis países más grandes de América Latina entre 1980 y 2010. Los resultados indican que las políticas sociales han influido en el crecimiento económico de esos países. De manera más precisa, existen variables no observables (efectos fijos) que afectaron positivamente el crecimiento de Venezuela y Chile, y factores no observables que afectaron negativamente a Brasil y México. Se encontró, además, que la velocidad de convergencia disminuye cuando aumenta el nivel de ingresos, lo que podría indicar que estos países pueden estar convergiendo a sus estados estacionarios.
PurposeMora and Acevedo (2019) report that the government spending multipliers in Latin American ... more PurposeMora and Acevedo (2019) report that the government spending multipliers in Latin American countries are notably higher than what is typically reported for developed economies. Latin American countries have been inclined toward using procyclical fiscal policies. Those policies have been perceived as being effective at mitigating the effects of the 2008–2009 Great Recession. This study aims to estimate the government spending multiplier using Latin American panel data from 19 Latin American countries from 2000 to 2018. The estimates are conditional on the extent of openness, capital mobility and economic freedom. Based on the results, the latter is important: the less economically free a country, the larger its spending multiplier. Lower economic freedom in Latin American countries can help to account for their large spending multipliers. In particular, restrictions on international trade are positively associated with multipliers. This is the case even while controlling the trade share of GDP. Design/methodology/approachThe authors provide regression results that are conditional on the extent of openness, capital mobility and economic freedom. FindingsThe less economically free a country, the larger its spending multiplier. Lower economic freedom in Latin American countries can help to account for their large spending multipliers. In particular, restrictions on international trade are positively associated with multipliers. This is the case even while controlling the trade share of GDP. Originality/valueTo the best of the authors’ knowledge, this is first study to estimate the fiscal multiplier conditional on economic freedom levels. The authors provide correctly calculated multipliers conditional on different levels of economic freedom. The authors point the way to future studies considering the effectiveness of fiscal policy conditional on institutional/policy quality.
Este trabajo presenta un modelo teórico de oferta y demanda agregada en una economía pequeña con ... more Este trabajo presenta un modelo teórico de oferta y demanda agregada en una economía pequeña con dos sectores productivos, bajo un régimen de cambio flexible y movilidad imperfecta de capitales. Se supone que solo uno de los sectores productivos produce un bien exportable que se vende a precios determinados en el mercado mundial, mientras que la producción del otro sector abastece el mercado interno. Este modelo permite explicar la propagación de los efectos de shocks internos (política económica, productividad, etc.) y externos (alteraciones en los términos de intercambio). Los resultados muestran que el producto real aumenta en todos los casos considerados y que estos son consistentes con los postulados por la teoría económica. No obstante, los efectos sobre el nivel de precios, la tasa de cambio y la tasa de interés real son variados. Desde el punto de vista de los shocks domésticos se puede apreciar que la política fiscal o la política monetaria pueden ser utilizadas para est...
This study considers how the formation and implementation strategies of a Latin America alliance ... more This study considers how the formation and implementation strategies of a Latin America alliance between four of the best economic performance countries in the region have impacted the quality of entrepreneurship in these countries. To this end, we studied the Pacific Alliance (PA) and employed an ordered probit model with sample selection bias and statistical information from the Global Entrepreneurship Monitor (GEM) database for the 2012–2017 period. As a dependent variable, we used the growth aspiration of entrepreneurs as a proxy to measure the future growth of the company, from which a possible economic impact could be inferred. The evidence shows that during the implementation period of the PA, there is a positive impact on entrepreneur growth aspirations in member countries; the likelihood that entrepreneurs have high-growth aspirations is found to be greater during and after the implementation period than before the signing of the PA. Likewise, it was found that motivation, ...
This study considers how the formation and implementation strategies of a Latin America alliance ... more This study considers how the formation and implementation strategies of a Latin America alliance between four of the best economic performance countries in the region have impacted the quality of entrepreneurship in these countries. To this end, we studied the Pacific Alliance (PA) and employed an ordered probit model with sample selection bias and statistical information from the Global Entrepreneurship Monitor (GEM) database for the 2012-2017 period. As a dependent variable, we used the growth aspiration of entrepreneurs as a proxy to measure the future growth of the company, from which a possible economic impact could be inferred. The evidence shows that during the implementation period of the PA, there is a positive impact on entrepreneur growth aspirations in member countries; the likelihood that entrepreneurs have high-growth aspirations is found to be greater during and after the implementation period than before the signing of the PA. Likewise, it was found that motivation, ...
We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides... more We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides nominal wage and price rigidities, we use the fact that Colombia has two productive and differentiated regions, Bogota that produces more than 25% of Colombia GDP (DANE, 2016) and the rest of the country, Ricardian and non-Ricardian agents, habit formation, capital adjustment costs, and modeled an entire foreign sector. Empirical results show that even when in the long run results are not very different in terms of real output, the short run effects are asymmetric implying that a shock to FDI in the rest of the country might cause important microeconomic adjustments that could improve the distribution of income throughout the country.
This paper studies the relationship between the size of the fiscal multiplier and the degree of c... more This paper studies the relationship between the size of the fiscal multiplier and the degree of capital mobility in some Latin American countries. Mundell's (1963) and Fleming's (1962) models show that this effect could be very large or small (close to zero) depending on the exchange rate and the degree of capital mobility, and the potency of a fiscal policy is inversely correlated with the degree of capital mobility. Based on Mora's (2013) model, we argue that the multiplier might not be negatively correlated with capital mobility in these countries. In other words, the potency of fiscal policy could be small because the degree of capital mobility in Latin American countries is quite low. The empirical findings support our hypothesis. We have found that the size of the fiscal multiplier tends to increase or (at least) to remain around 1.40 in these countries in the short run; however, in the long run, this effect tends to decrease significantly to 0.34. These results also suggest that the effectiveness of fiscal policies in Latin American countries are still large but could be larger if they become more financially integrated with the rest of the world.
We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides... more We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides nominal wage and price rigidities, we use the fact that Colombia has two productive and differentiated regions, Bogota that produces more than 25% of Colombia GDP (DANE, 2016) and the rest of the country, Ricardian and non-Ricardian agents, habit formation, capital adjustment costs, and modeled an entire foreign sector. Empirical results show that even when in the long run results are not very different in terms of real output, the short run effects are asymmetric implying that a shock to FDI in the rest of the country might cause important microeconomic adjustments that could improve the distribution of income throughout the country.
Este trabajo estudia las relaciones entre los factores socio-políticos y judiciales y la inversió... more Este trabajo estudia las relaciones entre los factores socio-políticos y judiciales y la inversión privada en los países latinoamericanos durante 1995-2003 mediante la técnica de datos panel. Los resultados empíricos muestran que los diferenciales de tasas de inversión, no solamente entre los países Latinoamericanos sino también con los países desarrollados, pueden ser causados por estos factores. Los países que tengan un sistema jurídico neutral y justo pueden obtener un aumento de hasta 2,29 puntos en la tasa de inversión. En cuanto al factor socio-político se puede señalar que mientras exista mejoras significativas de las instituciones, control de la corrupción y un mejor acceso a los derechos políticos y civiles, la tasa de inversión podría aumentar en aproximadamente 1,84 puntos porcentuales. Finalmente, de este trabajo se desprende que si los países latinoamericanos desean atraer nuevas inversiones, incrementar las posibilidades y experimentar un crecimiento económico sostenido y mejorar la calidad de vida de la población en el largo plazo, es necesario que sus gobernantes comiencen a preocuparse por el fortalecimiento y creación de instituciones que permitan disminuir la elevada corrupción, la represión en las libertades civiles, la pérdida de los derechos políticos y permitan mejorar el sistema judicial. Palabras clave: inversión privada, instituciones, estabilidad política, economías latinoamericanas, datos panel.
This paper presents an evaluation of how feasible would the establishment of a monetary union amo... more This paper presents an evaluation of how feasible would the establishment of a monetary union amongst the South American countries considering the methodology of the macroeconomic convergence degree. The empirical results indicate that a monetary union in South America is possible only if the governments commit themselves to establish and fulfill the rules of previous agreements on regional economic integration with the purpose of improving not only multilateral trade but also economic cooperation among them. According to the economic convergence index, it was found that South American economies, excluding Bolivia, have degrees of convergence similar to the corresponding for members of EMU, excluding Portugal and Ireland. Brazil is the economy that exhibits the best (the lowest) convergence index while Bolivia reveals the highest. The analysis of partial correlations does not show results as promising as the ones shown by the degree of convergence. On the contrary, these contrast with the ones obtained for European countries.
This paper studies how the socialpolitical and judicial factors have affected private investment ... more This paper studies how the socialpolitical and judicial factors have affected private investment in Venezuela and Latin America for the period 1995-2003 by means of panel data analysis. In the case of Venezuela, there is evidence that the fall in the investment rate in Venezuela has been caused by these factors. In this way, it is necessary that not only the Venezuelan government but also the other Latin American governments begin working on the creation and strengthening of institutions so that risks are reduced and stability is enhanced. In this way, it is possible to endorse a sustained economic growth and better standards of living for Latin American citizens.
por el financiamiento y el apoyo para la conclusión de este proyecto. Cómo citar este artículo: M... more por el financiamiento y el apoyo para la conclusión de este proyecto. Cómo citar este artículo: Mora, J. (2013). Fluctuaciones económicas bajo régimen de cambio fijo en una economía pequeña con dos sectores. Revista CIFE, 15 (22), pp. 141-160.
This paper presents a theoretical model of aggregate supply and demand in a small economy with tw... more This paper presents a theoretical model of aggregate supply and demand in a small economy with two productive sectors, under a flexible exchange regime and imperfect capital mobility. Only one of the production sectors is assumed to produce an exportable commodity sold at world market prices, while the production of the other sector is assumed to supply the domestic market. This model helps to explain how the impact of both domestic (economic policy, productivity, etc.) and foreign (changes in exchange terms) shocks is spread. In every case studied, results show that real output increases consistently with those cases postulated by economic theory. Conversely, the effects on the price level, the exchange rate and the real interest rate are ambiguous. In terms of domestic shocks, fiscal or monetary policy may be seen as a way to stabilize or stimulate the economy but the costs involved raise the price level.
This paper uses a Cholesky Factorization in a var analysis to investigate the relative importance... more This paper uses a Cholesky Factorization in a var analysis to investigate the relative importance of foreign and domestic shocks in the Venezuelan economy during the 1960:i- 2004:ii period. The economy is assumed to be driven by foreign (U. S. gdp and oil prices) and domestic (exchange rate, fiscal, monetary, inflation, and output) orthogonal shocks. As shown by the empirical evidence foreign shocks tend to be relatively more important than domestic shocks. Precisely, oil price and U. S. gdp shocks tend to have permanent effects on the main macroeconomic aggregates. Monetary policy only has temporary effects on output and the nominal exchange rate.
Durante décadas, la violencia ha afectado el desarrollo económico, político y social de Colombia.... more Durante décadas, la violencia ha afectado el desarrollo económico, político y social de Colombia. En este trabajo evaluamos los efectos de los delitos violentos contra las personas y la propiedad privada sobre el comportamiento de la inversión neta de la industria manufacturera en los departamentos de Colombia durante el período 2000-2013. Este trabajo se basa en los modelos propuestos por Acevedo y Mora (2009) y Acevedo y García (2015) y emplea información estadística de la Encuesta Anual de Manufactura y diversas formas de violencia (secuestros, robos y homicidios) obtenidas de la base de datos de la Revista Criminalidad para los 32 departamentos y Bogotá, D. C. Para ello se emplea un modelo de datos panel y se usa la bondad del ajuste como criterio para seleccionar los modelos que mejor se ajustan a los datos. La evidencia empírica muestra que la violencia medida por el número de secuestros, más que los homicidios y robos, es el fenómeno que más ha afectado la inversión en Colomb...
El presente estudio prueba la existencia de causalidad, en el sentido de Granger, y la dirección ... more El presente estudio prueba la existencia de causalidad, en el sentido de Granger, y la dirección de la misma entre el Producto Interno Bruto real, exportaciones, importaciones y la Inversión Extranjera Directa (FDI) para el caso de México. El análisis aplica tanto la metodología ...
Este escrito analiza la hipótesis de convergencia y el impacto de las políticas sociales en el cr... more Este escrito analiza la hipótesis de convergencia y el impacto de las políticas sociales en el crecimiento económico de los seis países más grandes de América Latina entre 1980 y 2010. Los resultados indican que las políticas sociales han influido en el crecimiento económico de esos países. De manera más precisa, existen variables no observables (efectos fijos) que afectaron positivamente el crecimiento de Venezuela y Chile, y factores no observables que afectaron negativamente a Brasil y México. Se encontró, además, que la velocidad de convergencia disminuye cuando aumenta el nivel de ingresos, lo que podría indicar que estos países pueden estar convergiendo a sus estados estacionarios.
PurposeMora and Acevedo (2019) report that the government spending multipliers in Latin American ... more PurposeMora and Acevedo (2019) report that the government spending multipliers in Latin American countries are notably higher than what is typically reported for developed economies. Latin American countries have been inclined toward using procyclical fiscal policies. Those policies have been perceived as being effective at mitigating the effects of the 2008–2009 Great Recession. This study aims to estimate the government spending multiplier using Latin American panel data from 19 Latin American countries from 2000 to 2018. The estimates are conditional on the extent of openness, capital mobility and economic freedom. Based on the results, the latter is important: the less economically free a country, the larger its spending multiplier. Lower economic freedom in Latin American countries can help to account for their large spending multipliers. In particular, restrictions on international trade are positively associated with multipliers. This is the case even while controlling the trade share of GDP. Design/methodology/approachThe authors provide regression results that are conditional on the extent of openness, capital mobility and economic freedom. FindingsThe less economically free a country, the larger its spending multiplier. Lower economic freedom in Latin American countries can help to account for their large spending multipliers. In particular, restrictions on international trade are positively associated with multipliers. This is the case even while controlling the trade share of GDP. Originality/valueTo the best of the authors’ knowledge, this is first study to estimate the fiscal multiplier conditional on economic freedom levels. The authors provide correctly calculated multipliers conditional on different levels of economic freedom. The authors point the way to future studies considering the effectiveness of fiscal policy conditional on institutional/policy quality.
Este trabajo presenta un modelo teórico de oferta y demanda agregada en una economía pequeña con ... more Este trabajo presenta un modelo teórico de oferta y demanda agregada en una economía pequeña con dos sectores productivos, bajo un régimen de cambio flexible y movilidad imperfecta de capitales. Se supone que solo uno de los sectores productivos produce un bien exportable que se vende a precios determinados en el mercado mundial, mientras que la producción del otro sector abastece el mercado interno. Este modelo permite explicar la propagación de los efectos de shocks internos (política económica, productividad, etc.) y externos (alteraciones en los términos de intercambio). Los resultados muestran que el producto real aumenta en todos los casos considerados y que estos son consistentes con los postulados por la teoría económica. No obstante, los efectos sobre el nivel de precios, la tasa de cambio y la tasa de interés real son variados. Desde el punto de vista de los shocks domésticos se puede apreciar que la política fiscal o la política monetaria pueden ser utilizadas para est...
This study considers how the formation and implementation strategies of a Latin America alliance ... more This study considers how the formation and implementation strategies of a Latin America alliance between four of the best economic performance countries in the region have impacted the quality of entrepreneurship in these countries. To this end, we studied the Pacific Alliance (PA) and employed an ordered probit model with sample selection bias and statistical information from the Global Entrepreneurship Monitor (GEM) database for the 2012–2017 period. As a dependent variable, we used the growth aspiration of entrepreneurs as a proxy to measure the future growth of the company, from which a possible economic impact could be inferred. The evidence shows that during the implementation period of the PA, there is a positive impact on entrepreneur growth aspirations in member countries; the likelihood that entrepreneurs have high-growth aspirations is found to be greater during and after the implementation period than before the signing of the PA. Likewise, it was found that motivation, ...
This study considers how the formation and implementation strategies of a Latin America alliance ... more This study considers how the formation and implementation strategies of a Latin America alliance between four of the best economic performance countries in the region have impacted the quality of entrepreneurship in these countries. To this end, we studied the Pacific Alliance (PA) and employed an ordered probit model with sample selection bias and statistical information from the Global Entrepreneurship Monitor (GEM) database for the 2012-2017 period. As a dependent variable, we used the growth aspiration of entrepreneurs as a proxy to measure the future growth of the company, from which a possible economic impact could be inferred. The evidence shows that during the implementation period of the PA, there is a positive impact on entrepreneur growth aspirations in member countries; the likelihood that entrepreneurs have high-growth aspirations is found to be greater during and after the implementation period than before the signing of the PA. Likewise, it was found that motivation, ...
We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides... more We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides nominal wage and price rigidities, we use the fact that Colombia has two productive and differentiated regions, Bogota that produces more than 25% of Colombia GDP (DANE, 2016) and the rest of the country, Ricardian and non-Ricardian agents, habit formation, capital adjustment costs, and modeled an entire foreign sector. Empirical results show that even when in the long run results are not very different in terms of real output, the short run effects are asymmetric implying that a shock to FDI in the rest of the country might cause important microeconomic adjustments that could improve the distribution of income throughout the country.
This paper studies the relationship between the size of the fiscal multiplier and the degree of c... more This paper studies the relationship between the size of the fiscal multiplier and the degree of capital mobility in some Latin American countries. Mundell's (1963) and Fleming's (1962) models show that this effect could be very large or small (close to zero) depending on the exchange rate and the degree of capital mobility, and the potency of a fiscal policy is inversely correlated with the degree of capital mobility. Based on Mora's (2013) model, we argue that the multiplier might not be negatively correlated with capital mobility in these countries. In other words, the potency of fiscal policy could be small because the degree of capital mobility in Latin American countries is quite low. The empirical findings support our hypothesis. We have found that the size of the fiscal multiplier tends to increase or (at least) to remain around 1.40 in these countries in the short run; however, in the long run, this effect tends to decrease significantly to 0.34. These results also suggest that the effectiveness of fiscal policies in Latin American countries are still large but could be larger if they become more financially integrated with the rest of the world.
We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides... more We build a DSGE model to study the asymmetries of FDI shocks in an economy like Colombia. Besides nominal wage and price rigidities, we use the fact that Colombia has two productive and differentiated regions, Bogota that produces more than 25% of Colombia GDP (DANE, 2016) and the rest of the country, Ricardian and non-Ricardian agents, habit formation, capital adjustment costs, and modeled an entire foreign sector. Empirical results show that even when in the long run results are not very different in terms of real output, the short run effects are asymmetric implying that a shock to FDI in the rest of the country might cause important microeconomic adjustments that could improve the distribution of income throughout the country.
Este trabajo estudia las relaciones entre los factores socio-políticos y judiciales y la inversió... more Este trabajo estudia las relaciones entre los factores socio-políticos y judiciales y la inversión privada en los países latinoamericanos durante 1995-2003 mediante la técnica de datos panel. Los resultados empíricos muestran que los diferenciales de tasas de inversión, no solamente entre los países Latinoamericanos sino también con los países desarrollados, pueden ser causados por estos factores. Los países que tengan un sistema jurídico neutral y justo pueden obtener un aumento de hasta 2,29 puntos en la tasa de inversión. En cuanto al factor socio-político se puede señalar que mientras exista mejoras significativas de las instituciones, control de la corrupción y un mejor acceso a los derechos políticos y civiles, la tasa de inversión podría aumentar en aproximadamente 1,84 puntos porcentuales. Finalmente, de este trabajo se desprende que si los países latinoamericanos desean atraer nuevas inversiones, incrementar las posibilidades y experimentar un crecimiento económico sostenido y mejorar la calidad de vida de la población en el largo plazo, es necesario que sus gobernantes comiencen a preocuparse por el fortalecimiento y creación de instituciones que permitan disminuir la elevada corrupción, la represión en las libertades civiles, la pérdida de los derechos políticos y permitan mejorar el sistema judicial. Palabras clave: inversión privada, instituciones, estabilidad política, economías latinoamericanas, datos panel.
This paper presents an evaluation of how feasible would the establishment of a monetary union amo... more This paper presents an evaluation of how feasible would the establishment of a monetary union amongst the South American countries considering the methodology of the macroeconomic convergence degree. The empirical results indicate that a monetary union in South America is possible only if the governments commit themselves to establish and fulfill the rules of previous agreements on regional economic integration with the purpose of improving not only multilateral trade but also economic cooperation among them. According to the economic convergence index, it was found that South American economies, excluding Bolivia, have degrees of convergence similar to the corresponding for members of EMU, excluding Portugal and Ireland. Brazil is the economy that exhibits the best (the lowest) convergence index while Bolivia reveals the highest. The analysis of partial correlations does not show results as promising as the ones shown by the degree of convergence. On the contrary, these contrast with the ones obtained for European countries.
This paper studies how the socialpolitical and judicial factors have affected private investment ... more This paper studies how the socialpolitical and judicial factors have affected private investment in Venezuela and Latin America for the period 1995-2003 by means of panel data analysis. In the case of Venezuela, there is evidence that the fall in the investment rate in Venezuela has been caused by these factors. In this way, it is necessary that not only the Venezuelan government but also the other Latin American governments begin working on the creation and strengthening of institutions so that risks are reduced and stability is enhanced. In this way, it is possible to endorse a sustained economic growth and better standards of living for Latin American citizens.
por el financiamiento y el apoyo para la conclusión de este proyecto. Cómo citar este artículo: M... more por el financiamiento y el apoyo para la conclusión de este proyecto. Cómo citar este artículo: Mora, J. (2013). Fluctuaciones económicas bajo régimen de cambio fijo en una economía pequeña con dos sectores. Revista CIFE, 15 (22), pp. 141-160.
This paper presents a theoretical model of aggregate supply and demand in a small economy with tw... more This paper presents a theoretical model of aggregate supply and demand in a small economy with two productive sectors, under a flexible exchange regime and imperfect capital mobility. Only one of the production sectors is assumed to produce an exportable commodity sold at world market prices, while the production of the other sector is assumed to supply the domestic market. This model helps to explain how the impact of both domestic (economic policy, productivity, etc.) and foreign (changes in exchange terms) shocks is spread. In every case studied, results show that real output increases consistently with those cases postulated by economic theory. Conversely, the effects on the price level, the exchange rate and the real interest rate are ambiguous. In terms of domestic shocks, fiscal or monetary policy may be seen as a way to stabilize or stimulate the economy but the costs involved raise the price level.
This paper uses a Cholesky Factorization in a var analysis to investigate the relative importance... more This paper uses a Cholesky Factorization in a var analysis to investigate the relative importance of foreign and domestic shocks in the Venezuelan economy during the 1960:i- 2004:ii period. The economy is assumed to be driven by foreign (U. S. gdp and oil prices) and domestic (exchange rate, fiscal, monetary, inflation, and output) orthogonal shocks. As shown by the empirical evidence foreign shocks tend to be relatively more important than domestic shocks. Precisely, oil price and U. S. gdp shocks tend to have permanent effects on the main macroeconomic aggregates. Monetary policy only has temporary effects on output and the nominal exchange rate.
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