EconPapers    
Economics at your fingertips  
 

Do sovereign wealth funds dampen the negative effects of commodity price volatility?

Kamiar Mohaddes () and Mehdi Raissi

Journal of Commodity Markets, 2017, vol. 8, issue C, 18-27

Abstract: This paper studies the impact of commodity terms of trade (CToT) volatility on economic growth (and its sources) in a sample of 69 commodity-dependent countries, and assesses the role of Sovereign Wealth Funds (SWFs) and quality of institutions in their long-term growth performance. Using annual data over the period 1981–2014, we employ the Cross-Sectionally augmented Autoregressive Distributive Lag (CS-ARDL) methodology for estimation to account for cross-country heterogeneity, cross-sectional dependence, and feedback effects. We find that while CToT volatility exerts a negative impact on economic growth (operating through lower accumulation of physical capital and lower TFP), the average impact is dampened if a country has a SWF and better institutional quality (hence a more stable government expenditure).

Keywords: Economic growth; Commodity prices; Volatility; Sovereign wealth funds (search for similar items in EconPapers)
JEL-codes: C23 E32 F43 O13 O40 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S2405851317300181
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Do Sovereign Wealth Funds Dampen the Negative Effects of Commodity Price Volatility? (2017) Downloads
Working Paper: Do sovereign wealth funds dampen the negative effects of commodity price volatility? (2017) Downloads
Working Paper: Do Sovereign Wealth Funds Dampen the Negative Effects of Commodity Price Volatility? (2017) Downloads
Working Paper: Do Sovereign Wealth Funds Dampen the Negative Effects of Commodity Price Volatility? (2000) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jocoma:v:8:y:2017:i:c:p:18-27

Access Statistics for this article

Journal of Commodity Markets is currently edited by Marcel Prokopczuk, Betty Simkins and Sjur Westgaard

More articles in Journal of Commodity Markets from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-10-05
Handle: RePEc:eee:jocoma:v:8:y:2017:i:c:p:18-27