American Economic Journal:
Macroeconomics
ISSN 1945-7707 (Print) | ISSN 1945-7715 (Online)
The Effects of Global Shocks on Small Commodity-Exporting Economies: Lessons from Canada
American Economic Journal: Macroeconomics
vol. 6,
no. 2, April 2014
(pp. 207–37)
Abstract
We propose a structural dynamic factor model of a small commodity-exporting economy, using Canada as a representative case study. Combining large panel data sets of the global and do- mestic economies, sign restrictions are used to identify relevant demand and supply shocks that explain volatility in real commod- ity prices. We quantify their dynamic e ffects on a wide variety of Canadian macro variables. We are able to reproduce all the main stylized features at business-cycle frequencies documented in the literature on this type of economies. These include a Dutch disease eff ect which has proven hard to find in empirical studies.Citation
Charnavoki, Valery, and Juan J. Dolado. 2014. "The Effects of Global Shocks on Small Commodity-Exporting Economies: Lessons from Canada." American Economic Journal: Macroeconomics, 6 (2): 207–37. DOI: 10.1257/mac.6.2.207Additional Materials
JEL Classification
- E32 Business Fluctuations; Cycles
- F14 Empirical Studies of Trade
- F32 Current Account Adjustment; Short-term Capital Movements
- F43 Economic Growth of Open Economies
- F44 International Business Cycles
- Q02 Global Commodity Markets
- Q33 Resource Booms
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