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Cointegration of Economic growth and External balance in Colombia: 1963-2016

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  • Barón Ortegón, Brayan Alexander

Abstract

In this paper is analyzed the relation between GDP growth and External balance in Colombia for the study period (1963-2016) by using a VECM. Supposing everything else unchanged, we conclude that Colombian external balance granger caused GDP growth and there was indeed a long run relation between both variables. This outcome helps to explain the Colombian GDP growth dynamics over the last fifty years and the impact of trade policy on economic growth.

Suggested Citation

  • Barón Ortegón, Brayan Alexander, 2018. "Cointegration of Economic growth and External balance in Colombia: 1963-2016," MPRA Paper 87974, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:87974
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    References listed on IDEAS

    as
    1. Leonardo Villar & José Vicente Romero & César Pabón, 2015. "Política cambiaria, monetaria y fiscal: ¿ha aprendido Colombia a mitigar los efectos de las crisis?," Informes de Investigación 13616, Fedesarrollo.
    2. James H. Stock & Mark W. Watson, 2001. "Vector Autoregressions," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 101-115, Fall.
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    More about this item

    Keywords

    Economic growth; External balance; Trade balance; Colombia; VEC model.;
    All these keywords.

    JEL classification:

    • F00 - International Economics - - General - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • F47 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Forecasting and Simulation: Models and Applications

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