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The Geography of Output Volatility

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  • Malik, Adeel
  • Temple, Jonathan

Abstract

This paper examines the structural determinants of output volatility in developing countries, and especially the roles of geography and institutions. We investigate the volatility effects of market access, climate variability, the geographic predisposition to trade, and various measures of institutional quality. We find an especially important role for market access: remote countries are more likely to have undiversified exports and to experience greater volatility in output growth. Our results are based on Bayesian methods that allow us to address formally the problem of model uncertainty and to examine robustness across a wide range of specifications.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5516.

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Date of creation: Feb 2006
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Handle: RePEc:cpr:ceprdp:5516

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Keywords: Bayesian model averaging; geography; institutions; volatility;

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