A structural VAR model of the Fiji Islands

Seema Narayan ()

Economic Modelling, 2013, vol. 31, issue C, 238-244

Abstract: A four-dimensional Structural Vector Auto-regression (SVAR) model is applied to investigate the implications of fuel imports and devaluation policy on Fiji's current account deficits and economic growth. The paper finds that short-term deterioration of the current account is partly due to higher fuel imports. The impulse response analysis shows that a standard deviation fall in Fiji's REER leads to a J-curve type response in the current account within a short period. Furthermore, fuel import demand and devaluations are found to have negative, but transitory, effect on economic growth.

Keywords: SVAR; Fuel imports; Current account; Economic growth; Devaluation; Small Island Developing State (search for similar items in EconPapers)
JEL-codes: F41 Q43 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:31:y:2013:i:c:p:238-244

DOI: 10.1016/j.econmod.2012.11.014

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