Do oil prices predict economic growth? New global evidence

Paresh Narayan (), Susan Sharma, Wai-Ching Poon and Joakim Westerlund

Energy Economics, 2014, vol. 41, issue C, 137-146

Abstract: In this paper, we test whether oil price predicts economic growth for 28 developed and 17 developing countries. We use predictability tests that account for the key features of the data, namely, persistency, endogeneity, and heteroskedasticity. Our analysis considers a large number of countries, shows evidence of more out-of-sample predictability with nominal than real oil prices, finds in-sample predictability to be independent of the use of nominal and real prices, and reveals greater evidence of predictability for developed countries.

Keywords: Economic growth; Predictability; Oil price (search for similar items in EconPapers)
JEL-codes: C22 E31 E37 F43 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (87)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:41:y:2014:i:c:p:137-146

DOI: 10.1016/j.eneco.2013.11.003

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