External cycles and commodities in Latin America and the Caribbean: a cointegration analysis with breaks

Fernando Delbianco () and Andrés Fioriti ()
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Andrés Fioriti: Universidad Nacional del Sur

Lecturas de Economía, 2018, issue 88, 51-76

Abstract: In this paper, we seek to characterize the relationship between the cyclical behavior of foreign accounts and commodity price indexes for Latin America and the Caribbean. Using several tests of stationarity that allow for the presence of breaks, we conclude that commodity prices are cointegrated with the current accounts in Latin American countries, suggesting that developmentalism plans did not obtain the desired productive diversification and that the region still relies heavily on commodities to determine its foreign position. Another important result supports the findings of Delbianco and Fioriti (2014, 2015) that the region had suffered two sudden stops in the last 60 years, both driven by shifts in commodity prices.

Keywords: external sector; structural breaks; cointegration; Latin America (search for similar items in EconPapers)
JEL-codes: C12 C58 E44 F44 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (3)

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Journal Article: External cycles and commodities in Latin America and the Caribbean: a cointegration analysis with breaks (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:lde:journl:y:2018:i:88:p:51-76

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DOI: 10.17533/udea.le.n88a02

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