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GMM Estimation and Shapiro-Francia Normality Test: A Case Study of CEE Economies

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  • Davtyan Azat

Abstract

The present paper estimates the link between GDP per capita, inflation (GDP deflator), exports, imports, final consumption, gross capital formation, tax revenue and public expense of CEE countries (Bulgaria, Romania, the Czech Republic, Slovak Republic, Poland, Slovenia and Russia) using GMM estimation for the period 2005-2010. Besides, we run Shapiro-Francia W' test to indicate the patterns of normal distribution among samples of our study. The objective of this quantitative empirical is twofold: first, it examines the linkages of economic indicators of CEE countries in order to find out the main changes of economic landscape. Second, it aims at highlighting the development of CEE countries on the way of deeper convergence to the euro area utilizing the available panel series. We find that GDP per capita of CEE countries is in negative relationship with expense, final consumption, gross capital formation, exports and inflation. With regard to Shapiro-Francia W' test, we assume that variables show a normal distribution.

Suggested Citation

  • Davtyan Azat, 2014. "GMM Estimation and Shapiro-Francia Normality Test: A Case Study of CEE Economies," International Journal of Economic Sciences, Prague University of Economics and Business, vol. 2014(1), pages 12-26.
    • Handle: RePEc:prg:jnljes:v:2014:y:2014:i:1:id:2:p:12-26
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    2. Afsin Sahin, 2023. "Testing Distributions in Banking Sector Loans with Different Computer Programs: An Experimental Analysis for Turkey," Athens Journal of Business & Economics, Athens Institute for Education and Research (ATINER), vol. 9(2), pages 145-158, April.

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    More about this item

    Keywords

    exports; final consumption; Arellano-Bond test; GMM; gross capital formation; imports; exports; final consumption; Arellano-Bond test; GMM; gross capital formation; imports;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General

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