¿Hay evidencias de déficits gemelos en la economía dominicana?

Is there evidence of twin deficits in the Dominican economy?

Marycris Brito Romero, Anadel G. Peguero and Alexis Cruz-Rodriguez

MPRA Paper from University Library of Munich, Germany

Abstract: The aim of this article is to examine the existence or not of the "twin deficits" in the case of the Dominican Republic in the period 1955-2014. Using an error correction vector (VEC), the results confirm a positive long run relationships between fiscal and trade balance deficits. Similarly, bidirectional causality between deficits is verified using the Granger test. However, the results of the variance decomposition show inconclusive results regarding causality. The results of impulse response functions suggest that the consequences of large budget and trade balance deficits become noticeable only over the long run. Additionally, the influence of factors such as trade openness and financial development contribute new elements that contribute to validate the model.

Keywords: Fiscal deficit; trade deficit; cointegration. (search for similar items in EconPapers)
JEL-codes: F10 F13 F31 F32 (search for similar items in EconPapers)
Date: 2020-06-03
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:100938

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