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Modeling Growth (and Liberalization) Using Smooth Transitions Analysis


  • Greenaway, David
  • Leybourne, Stephen
  • Sapsford, David


Economic liberalization has been a pervasive phenomenon over the last twenty years. Programs have been initiated on the assumption that liberalization promotes economic growth but the empirical evidence for this is limited. This paper takes a novel approach to modeling growth and structural change as smooth transitions. This allows the authors to model deterministic change without imposing discrete changes. They use smooth transition analysis to reappraise the time-series properties of long-run growth rates in a number of developing countries which have undertaken liberalization. The authors' results challenge conventional wisdom on both methodological and empirical grounds. Copyright 1997 by Oxford University Press.

Suggested Citation

  • Greenaway, David & Leybourne, Stephen & Sapsford, David, 1997. "Modeling Growth (and Liberalization) Using Smooth Transitions Analysis," Economic Inquiry, Western Economic Association International, vol. 35(4), pages 798-814, October.
  • Handle: RePEc:oup:ecinqu:v:35:y:1997:i:4:p:798-814

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    References listed on IDEAS

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    Cited by:

    1. Omar A Mendoza Lugo, 2008. "The differential impact of real interest rates and credit availability on private investment: evidence from Venezuela," BIS Papers chapters,in: Bank for International Settlements (ed.), Transmission mechanisms for monetary policy in emerging market economies, volume 35, pages 501-537 Bank for International Settlements.
    2. Pablo Mejia-Reyes & Denise Osborn & Marianne Sensier, 2010. "Modelling real exchange rate effects on output performance in Latin America," Applied Economics, Taylor & Francis Journals, vol. 42(19), pages 2491-2503.
    3. Falvey, Rod & Foster, Neil & Greenaway, David, 2012. "Trade Liberalization, Economic Crises, and Growth," World Development, Elsevier, vol. 40(11), pages 2177-2193.
    4. Manamba EPAPHRA, 2016. "Determinants of Export Performance in Tanzania," Journal of Economics Library, KSP Journals, vol. 3(3), pages 470-487, September.
    5. Chen, XiaoHua & Maringer, Dietmar, 2011. "Detecting time-variation in corporate bond index returns: A smooth transition regression model," Journal of Banking & Finance, Elsevier, vol. 35(1), pages 95-103, January.

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