El centro y la periferia, una aproximación empírica a la relación entre Lima y el resto del país

The main purpose of this paper is to evaluate empirically the economic relation between Lima and some departments of the country by estimating the effect of shocks affecting Lima's growth over the rates of growth of the remaining departments. We do not pretend to describe the mechanisms of transmission but to identificate the negative and positive effects of shocks coming from Lima, considered "the center," over the rest of departments, considered "the periphery". It will be used the Autorregresive Vector Model in its Moving Average representation (VMA), in which the endogenous variables are Lima's rate of growth, the rate of growth and the rate of inflation of a periphery department. It is assumed that these variables are affected by shocks of demand and supply originated in the center and the periphery. In order to ortogonalize the estimated error variance-covariance matrix we will use the Blanchard and Quah decomposition, in which innovations or aggregate demand shocks have no effect over the product on the long run.