Naslov
Croatian Terms of Trade ; Historical Perspective, Movements and Welfare Effect

Autori
Tomić, Daniel

Izvornik
Ekonomska Istrazivanja-Economic Research (1331-677X) 25 (2012), 1; 117-139

Vrsta, podvrsta i kategorija rada
Radovi u časopisima, original scientific paper, znanstveni

Ključne riječi
terms of trade; welfare effect; Prais-Winsten; Granger causality; Croatia

Sažetak
Croatia is a small – open – import dependent economy with strong trade imbalances. Thus it implies certain effect on national welfare. The aim of this paper is to examine the impact of the trend and volatility of terms of trade on economic growth of Croatia using time series data. Moreover, the paper in an indirect way evaluates the effectiveness of the openness on economic performance of Croatian economy. In such manner we can assess the dynamics of import and export prices on economic growth. Results are consistent with the theory, however they suggest that terms of trade do not have substantial welfare effect on the economy. Estimation is based on Prais-Winsten regression of iterative procedures which eliminates the problem of serial correlation, as one of the frequent problems in these types of estimation. In addition, stationary VAR was obtained in order to present the dynamics of changes in terms of trade.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

Napomena
Special issue (best papers) of the 5th International Scientific Conference 'Entrepreneurship and Macroeconomic Management: Reflection on the World in Turmoil'

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