Nexus between Economic Stability and Political Stability in China and Japan

Vedat Yorucu () and Dervis Kirikkaleli
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Vedat Yorucu: Department of Economics, Eastern Mediterranean University, Famagusta, Northern Cyprus, Mersin-10, Turkey

Economic Research Guardian, 2021, vol. 11, issue 2, 182-193

Abstract: This research aims to investigate the causal relationship between economic stability and political stability for Japanese and Chinese markets. Based on the study’s aims, time domain causality tests - Granger causality, Toda-Yamamoto causality, and nonlinear Diks-Panchenko causality - and a frequency domain causality test - spectral Breitung and Candelon causality - are employed. The outcomes of the time domain causality tests reveal that there is feedback causality between political stability and economic stability in both countries, indicating that political stability is an important predictor for economic stability in both countries and vice versa.

Keywords: Political Stability; Economic Stability; Frequency Domain Causality; China; Japan (search for similar items in EconPapers)
JEL-codes: C01 E02 F50 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:wei:journl:v:11:y:2021:i:2:p:182-193

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