Terms of Trade Shocks and the Current Account in Small Island Developing States
AbstractThe paper investigates the dynamic relationship between external and internal shocks and the current account in selected small islands developing states. External shocks, defined as terms of trade fluctuations, explain a significant proportion of the variation in the current account balances. The external shocks have a temporary negative impact on the current account balances with a subsequent improvement, generating a J-curve type reaction. In contrast, real output shocks have a positive and significant effect on the current account.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Journal of Development Studies.
Volume (Year): 46 (2010)
Issue (Month): 5 ()
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- Wacker, Konstantin M. & Großkurth, Philipp & Lakemann, Tabea, 2014. "Terms of Trade, Foreign Direct Investment, and Development: A Case of Intra-Asian “Kicking Away the Ladder”?," Working Papers on Regional Economic Integration 122, Asian Development Bank.
- Konstantin M. Wacker, 2011. "Do multinationals beat down developing countries' export prices? The impact of FDI on net barter terms of trade," Ibero America Institute for Econ. Research (IAI) Discussion Papers 211, Ibero-America Institute for Economic Research.
- Narayan, Seema, 2013. "A structural VAR model of the Fiji Islands," Economic Modelling, Elsevier, vol. 31(C), pages 238-244.
- Konstantin M. Wacker, 2011. "The Impact of Foreign Direct Investment on Developing Countries’ Terms of Trade," Working Paper Series UNU-WIDER Working Paper W, World Institute for Development Economic Research (UNU-WIDER).
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