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Responses of Output to Declining Stock Values and Real Depreciation in Lituania

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  • Yu Hsing

    (Department of General Business, Southeastern Louisiana University)

Abstract

This paper examines output fluctuations for Lithuania by applying the IS-MP-UIP model. Comparative-static analysis is applied to find the possible sign of a change in an exogenous variable on the equilibrium real GDP. The generalized least squares method is employed to estimate consistent covariance and standard errors. The CUSUM and CUSUMSQ tests are employed to assess the stability of the estimated regression. The results show that a higher ratio of government deficit/GDP, a lower expected real exchange rate, a higher real stock value, a lower real euro interest rate, more output in the EU, and a lower inflation rate would increase real GDP.

Suggested Citation

  • Yu Hsing, 2009. "Responses of Output to Declining Stock Values and Real Depreciation in Lituania," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 62(4), pages 429-437.
    • Handle: RePEc:ris:ecoint:0367
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    References listed on IDEAS

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    Cited by:

    1. Dan Lupu & Mircea Asandului, 2014. "Exchange Rate and Trade: J-curve in European Union," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 3(3), pages 136-145, June.
    2. Jana Šimáková, 2014. "The Effects of Exchange Rate Change on the Trade Balance of Slovakia," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2014(3), pages 50-66.

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    Keywords

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    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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