Impact of Terms-of-Trade on Slovakia, the Czech Republic, and Croatia in the Short Run

Karol Szomolányi (), Lukáčik Martin () and Lukáčiková Adriana ()
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Lukáčik Martin: Department of Operations Research and Econometrics, University of Economics Bratislava, Slovakia
Lukáčiková Adriana: Department of Operations Research and Econometrics, University of Economics Bratislava, Slovakia

Naše gospodarstvo/Our economy, 2017, vol. 63, issue 1, 3-13

Abstract: The terms-of-trade shocks are not main source of business cycles in three post-communist countries (i.e., Slovakia, the Czech Republic, and Croatia). The zero or negative reactions of the trade balance in terms-of-trade positive shocks in the countries exhibit the Obstfeld-Svensson-Razin effect, according to which the Harberger-Laursen-Metzler positive effect on terms-of-trade indicates that the smaller the trade balance, the more persistent the terms-of-trade shock is. The conclusions come from the structural vector autoregressive analysis of the cyclical components of terms-of-trade, trade balance, output, consumption, and investment in three post-communist countries.

Keywords: innovation; terms-of-trade; business cycle; Slovak economy; Czech economy; Croatian economy; trade balance (search for similar items in EconPapers)
JEL-codes: C32 E32 F14 (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:ngooec:v:63:y:2017:i:1:p:3-13:n:1

DOI: 10.1515/ngoe-2017-0001

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