The Endogeneity of the Natural Rate of Growth – an Empirical Study for Latin-American Countries

Lena Vogel ()
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Lena Vogel: Department for Economics and Politics, University of Hamburg
Authors registered in the RePEc Author Service: Lena Dräger

No 200704, Macroeconomics and Finance Series from University of Hamburg, Department of Socioeconomics

Abstract: The aim of this paper is to analyse the sensitivity of the natural rate of growth to the actual rate of growth for a sample of eleven Latin-American countries, assuming the natural rate to be determined endogenously by changes in the actual rate of growth. The natural rates of growth are estimated in a system of SUR estimations over the period 1986-2003. In order to determine whether they react endogenously to changes in the actual rate of growth, a dummy variable for boom periods is added to the system of regressions. In the second part of the empirical analysis, the direction of causality between input growth and output growth is then tested for four of the countries in the first sample. The results confirm not only the hypothesis about the endogeneity of the natural rate of growth, but also show causality from output growth to input growth to be much stronger than the reverse. Length: 28 pages

Keywords: Natural rate of growth; actual rate of growth; endogeneity; Granger causality; Latin America (search for similar items in EconPapers)
JEL-codes: C23 E10 O40 (search for similar items in EconPapers)
Date: 2007-04
New Economics Papers: this item is included in nep-cba, nep-dev and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://www.wiso.uni-hamburg.de/repec/hepdoc/macppr_4_2007.pdf First version, April 2007 (application/pdf)

Related works:
Journal Article: The endogeneity of the natural rate of growth - an empirical study for Latin-American countries (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hep:macppr:200704

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