Brazil's twin deficits: An empirical examination
This paper examines empirically the causal relationship between budget deficits and trade deficits for Brazil from 1973:1Q through 1991:4Q. This relationship is investigated in the context of Granger's test of causality. The final prediction error criterion, as outlined by Hsiao , is applied in determining the appropriate lag length of the two variables. Empirical results suggested the presence of bilateral causality between trade deficits and budget deficits. Copyright International Atlantic Economic Society 1998
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Volume (Year): 26 (1998)
Issue (Month): 2 (June)
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- Cebula, Richard J, 1991. "Federal Government Budget Deficits and Interest Rates: Reply," Public Finance = Finances publiques, , vol. 46(2), pages 331-34.
- Cardoso, Eliana A., 1991. "Deficit finance and monetary dynamics in Brazil and Mexico," Journal of Development Economics, Elsevier, vol. 37(1-2), pages 173-197, November.
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- Plosser, Charles I., 1982. "Government financing decisions and asset returns," Journal of Monetary Economics, Elsevier, vol. 9(3), pages 325-352.
- Bahmani-Oskooee, Mohsen & Payesteh, Sayeed, 1993. "Budget deficits and the value of the dollar: An application of cointegration and error-correction modeling," Journal of Macroeconomics, Elsevier, vol. 15(4), pages 661-677.
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"Government Deficits and Aggregate Demand,"
NBER Working Papers
0435, National Bureau of Economic Research, Inc.
- Hsiao, Cheng, 1981. "Autoregressive modelling and money-income causality detection," Journal of Monetary Economics, Elsevier, vol. 7(1), pages 85-106.
- Bharat R. Koluri & Demetrios S. Giannaros, 1987. "Deficit and External Debt Effects on Money and Inflation in Brazil and Mexico: Some Evidence," Eastern Economic Journal, Eastern Economic Association, vol. 13(3), pages 243-248, Jul-Sep.
- Akaike, Hirotugu, 1981. "Likelihood of a model and information criteria," Journal of Econometrics, Elsevier, vol. 16(1), pages 3-14, May.
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