scholarly journals Cointegration and error correction modelling of agricultural commodity trade: The case of ASEAN agricultural exports to the EU

2003 ◽  
Vol 12 (Supplement) ◽  
Author(s):  
J. NIEMI
Keyword(s):  
Error Correction ◽  
Agricultural Commodity ◽  
Commodity Trade ◽  
Price Changes ◽  
Agricultural Exports ◽  
Long Run ◽  
Export Supply ◽  
Asean Countries ◽  
The Eu ◽  
Modelling Approach

The objecti e of this study is to increase our understanding of the specification and estimation of agricultural commodity trade models as well as to provide instruments for trade policy analysis. More specifically,the aim is to build a set of dynamic,theory-based econometric models which are able to capture both short-run and long-run effects of income and price changes,and which can be used for prediction and policy simulation under alternati e assumed conditions.A relati ely unrestricted,data determined,econometric modelling approach based on the error correction mechanism is used,in order to emphasise the importance of dynamics of trade functions.Econometric models are constructed for se en agricultural commodities –cassa a,cocoa,coconut oil,palm oil,pepper, rubber,and tea –exported from the Association of Southeast Asian Nations (ASEAN)to the European Union (EU).With the aim of providing broad commodity co erage,the intent is to explore whether the chosen modelling approach is able to catch the essentials of the behavioural relationships underlying the specialised nature of each commodity market. The import demand analysis of the study examines two key features:(1)the response of EU ’s agricultural commodity imports to income and price changes,and (2)the length of time required for this response to occur.The estimations of the export demand relationships provide tests whether the exporters ’ market shares are influenced by the le el of relati e export price,and whether exports are affected by ariations in the rate of growth of imports.The export supply analysis examines the relati e influence of real price and some non-price factors in stimulating the supply of exports.The lag distribution (the shape and length of the lag)is found to be ery critical in export supply relationships,since the effects of price changes usually take a long time to work themselves through and since the transmission of the price effects can be complex.The set of dynamic econometric models estimated in the study are then used to simulate the effects different types of trade policies.More specifically,attempts are made to quantify the effects of a unilateral tariff remo al by the EU,an imposition of export subsidies and taxes by the ASEAN countries as well as exchange rate adjustments on ASEAN agricultural exports to the EU. The results suggest that concepts such as cointegration and error correction specification are well suited for the study of agricultural trade flows,which are typically non-stationary time series.The error correction specification is found to provide a good representation of the data-generating process for agricultural commodity flows from ASEAN countries to the EU.Furthermore,the study shows the importance of inspection of the time series properties and the examination of both short-and long-run adjustment when studying trade functions.The different dynamic responses are often critical to the outcomes of the types of trade policies considered.;

scholarly journals Assessment of Biotechnology Policies and International Trade in Key Markets for U.S. Agriculture

2005 ◽  
Vol 37 (2) ◽  
pp. 379-391 ◽  
Author(s):  
Mary A. Marchant ◽  
Baohui Song
Keyword(s):  
United States ◽  
The United States ◽  
International Markets ◽  
The European Union ◽  
Department Of Agriculture ◽  
Agricultural Exports ◽  
Biotechnology Research ◽  
Long Run ◽  
The World ◽  
The Eu

The United States leads the world in agricultural biotechnology research, adoption, commercialization, and exports. Our biotech commodities are highly dependent on international markets. Thus, any biotech policy changes by key importing countries may affect U.S. agricultural biotech product exports. This article identifies key markets for U.S. agricultural exports including biotech commodities and discusses current and proposed biotech policies in key markets for U.S. agricultural exports focusing on Canada, Mexico, Japan, the European Union (EU), and China. Among these markets, labeling of biotech products is voluntary in Canada and Mexico but is mandatory in Japan, the EU, and, most recently, in China. For the EU, U.S. corn exports were almost completely shut out, while U.S. soybean exports also declined because of the EU's biotech policies. The World Trade Organization dispute filed by the United States has yet to be finalized. China's biotech regulations raised concern by U.S. agricultural exporters. However, through U.S. Department of Agriculture education programs, U.S.–China negotiations, and China's domestic soybean shortage, China's biotech regulations do not appear to have had long-run impacts on U.S. soybean exports to China.

scholarly journals Hungarian endeavours for the enhancement of economic relations in Southeast Asia focusing on a new partnership with Vietnam

2020 ◽  
Vol 11 (3-4) ◽  
pp. 5-12
Author(s):  
László Kozár ◽  
György Iván Neszmélyi
Keyword(s):  
Foreign Trade ◽  
Agricultural Trade ◽  
Export Market ◽  
Agricultural Export ◽  
Economic Relations ◽  
Long Run ◽  
Asean Countries ◽  
The Government ◽  
Foreign Trade Turnover ◽  
The Eu

Beyond a brief review of the economic integration process among the states of the ASEAN region, the authors of the present study aimed to examine and analyze the main economic, social and political characteristics of the Hungaro-ASEAN relations. The importance of the topic of this research is underlined by the fact that the Hungarian government considers big importance to the improvement of the foreign economic relations with Asian economies. This intention was expressed by a new foreign economic strategy „Eastern opening” announced by the government in 2012, even though the foreign trade statistical figures did not justify its success by now.The authors believe that increasing opening towards Asia serves Hungarian economic interests. Therefore, it is a right and desirable direction to proceed, they consider that in the background of the modest results there might be the insufficient knowledge of the market mechanisms, the actors of the local supply chains and the potential partners. They believe that in order to make the Hungarian foreign economic endeavours in this direction more successful a more thorough examination of the local characteristics – including the actual demand arising at the targeted markets - is necessary. This opinion is prevalent to not only the Asian „Giants”, like China, India and Japan, but also to smaller states, like the ASEAN members, which – together - in terms of population and economic performance – reach the dimensions of an economic great power as well.Furthermore, the integration of the ten Southeast Asian countries develops rapidly, which is coupled by their increasing weight in the world trade. The dynamic economic and social development in the ASEAN region – and in parallel with this the growing demands and purchasing power - may encourage the Hungarian ventures in theory. However, there are still very few Hungarian entrepreneurs, who are ready to enter the market in the region and able in long run to operate there successfully. It is a well-known fact that the since the regime has changed in Hungary, foreign trade became strongly concentrated towards the EU members.The ASEAN countries – because of the geographic distance and by other reasons - definitely cannot mean an alternative of the EU market, however in a certain extent they can relieve this one-sided concentration and may provide additional opportunities for the Hungarian export of goods, and rather to the export of Hungarian services and know-how. The ratio of the ASEAN region within the entire Hungarian foreign trade turnover is small nowadays, furthermore – according to the statistical figures – this region is rather an import resource for Hungary than being an export market. This fact – just itself – is should not be considered as problem. When the amount of the import exceeds the amount of exports, that means that it is more worthwhile to do business with suppliers from there countries than with others. By and large all this is prevalent to the field of the agricultural trade as well: Hungary imports a range of commodities which cannot be produced by domestic farmers or in Europe (spices, tropical fruits, etc.). It is obvious that the ASEAN region cannot be the major market for the Hungarian agricultural export, not even in long run. However, there are still a lot of opportunities to enlarge the turnover of goods and services and enhance the co-operation in this geographic region. In the last chapter, the authors outlined an example in case of Vietnam – co-operation of joint public warehousing of agricultural commodities – which may be a good example for the promising potential opportunities. In contrast with the majority of the ASEAN countries, the Hungaro-Vietnamese political and economic relations had started much earlier than the regime was changed in Hungary. However, the potential advantages arose from this fact – the network of connections and the sympathy of Vietnamese professionals graduated in Hungary, the reputation and popularity of Hungarian agricultural products and technologies, the achievements of R&D in the field of agriculture – could not be utilized from Hungarian side. Vietnam, however still preserved its socialist political establishment, but in terms of its economic development strategy and economic policy has gradually been standing on the basis of market orientation. Vietnam, with its population of ninety million shows a rapid and successful development and it means good opportunities even for Hungarian entrepreneurs. It would be a mistake to leave these potentials unused. JEL Classification: F14, Q17, R11, N75

Rail Transport and Economic Growth in Nigeria (1970 – 2011).

2013 ◽  
Vol 03 (05) ◽  
pp. 18-24
Author(s):  
APANISILE Olumuyiwa Tolulope ◽  
AKINLO Taiwo
Keyword(s):  
Economic Growth ◽  
Error Correction ◽  
Inverse Relationship ◽  
Correction Term ◽  
Rail Transport ◽  
Long Run ◽  
Development Policies ◽  
Full Capacity ◽  
The Government ◽  
Modelling Approach

The study examined the link between rail transport and economic growth in Nigeria over the period 1970-2011 using Error Correction modelling approach. The results show that there is long run relationship among the variables. In addition, the EC models show that the error correction term is correctly signed and significant while there is inverse relationship between rail transport and economic growth in Nigeria. This explains the decadence in the sector due to the neglect of the sector by the government. The study therefore concludes that government should embark on development policies that will aim at strengthening the sub-sector of the economy so that it can operate in its full capacity and neutralise the decadence that is evident in the sector.

Hypothesis testing with error correction models

2021 ◽  
pp. 1-9
Author(s):  
Patrick W. Kraft ◽  
Ellen M. Key ◽  
Matthew J. Lebo
Keyword(s):  
Hypothesis Testing ◽  
Error Correction ◽  
Null Hypothesis ◽  
Alternative Hypothesis ◽  
Correction Coefficient ◽  
Correction Model ◽  
Long Run ◽  
Independent Variable ◽  
The Right ◽  
General Error

Abstract Grant and Lebo (2016) and Keele et al. (2016) clarify the conditions under which the popular general error correction model (GECM) can be used and interpreted easily: In a bivariate GECM the data must be integrated in order to rely on the error correction coefficient, $\alpha _1^\ast$ , to test cointegration and measure the rate of error correction between a single exogenous x and a dependent variable, y. Here we demonstrate that even if the data are all integrated, the test on $\alpha _1^\ast$ is misunderstood when there is more than a single independent variable. The null hypothesis is that there is no cointegration between y and any x but the correct alternative hypothesis is that y is cointegrated with at least one—but not necessarily more than one—of the x's. A significant $\alpha _1^\ast$ can occur when some I(1) regressors are not cointegrated and the equation is not balanced. Thus, the correct limiting distributions of the right-hand-side long-run coefficients may be unknown. We use simulations to demonstrate the problem and then discuss implications for applied examples.

scholarly journals Analysis of the New Kuznets Relationship: Considering Emissions of Carbon, Methanol, and Nitrous Oxide Greenhouse Gases—Evidence from EU Countries

2021 ◽  
Vol 18 (6) ◽  
pp. 2907
Author(s):  
Mara Madaleno ◽  
Victor Moutinho
Keyword(s):  
Nitrous Oxide ◽  
Least Squares ◽  
Fixed Effects ◽  
Ghg Emissions ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Ekc Hypothesis ◽  
Long Run ◽  
Short Run ◽  
The Eu

Decreased greenhouse gas emissions (GHG) are urgently needed in view of global health threat represented by climate change. The goal of this paper is to test the validity of the Environmental Kuznets Curve (EKC) hypothesis, considering less common measures of environmental burden. For that, four different estimations are done, one considering total GHG emissions, and three more taking into account, individually, the three main GHG gases—carbon dioxide (CO2), nitrous oxide (N2O), and methane gas (CH4)—considering the oldest and most recent economies adhering to the EU27 (the EU 15 (Old Europe) and the EU 12 (New Europe)) separately. Using panel dynamic fixed effects (DFE), dynamic ordinary least squares (DOLS), and fully modified ordinary least squares (FMOLS) techniques, we validate the existence of a U-shaped relationship for all emission proxies considered, and groups of countries in the short-run. Some evidence of this effect also exists in the long-run. However, we were only able to validate the EKC hypothesis for the short-run in EU 12 under DOLS and the short and long-run using FMOLS. Confirmed is the fact that results are sensitive to models and measures adopted. Externalization of problems globally takes a longer period for national policies to correct, turning global measures harder and local environmental proxies more suitable to deeply explore the EKC hypothesis.

scholarly journals A Hierarchical Bayes Error Correction Model to Explain Dynamic Effects of Price Changes

2006 ◽  
Vol 43 (3) ◽  
pp. 443-461 ◽  
Author(s):  
Dennis Fok ◽  
Csilla Horváth ◽  
Richard Paap ◽  
Philip Hans Franses
Keyword(s):  
Error Correction ◽  
Error Correction Model ◽  
Hierarchical Bayes ◽  
Dynamic Effects ◽  
Price Changes ◽  
Correction Model ◽  
Bayes Error

Income convergence in Europe: Catching up or falling behind?

2012 ◽  
Vol 62 (2) ◽  
pp. 183-204 ◽  
Author(s):  
Megan Czasonis ◽  
Michael Quinn
Keyword(s):  
European Countries ◽  
Eastern European ◽  
The European Union ◽  
Income Convergence ◽  
Euro Zone ◽  
Long Run ◽  
Time Period ◽  
Eastern European Countries ◽  
Time Frames ◽  
The Eu

One of the motivations for a country to join the European Union is the belief that this will boost short- and long-run incomes. Researchers have tested the hypothesis of income convergence in different settings using either regression or unit root analysis, with mixed results. In this paper, we use both methods on the same samples over a significant time period. This allows us to judge differences in results across varied time-frames and methodologies. The focus of these tests is on convergence to German and EMU average incomes by Eastern European countries and those within the Euro-zone from 1971–2007. The evidence for convergence is mixed. Among the Euro-zone countries, there is more evidence of convergence in the 1970s and 1980s than recently. There is significant evidence that Eastern Europe experienced convergence and that capital formation was one of the root causes. While the results do not support the hypothesis that joining the EU increases convergence, reforms undertaken in the 1990s by Eastern European countries in preparation for joining may have helped them to “catch up”, even if the act of joining the EU did not directly impact convergence.

Disappearing peasants?

Focaal ◽  
2008 ◽  
Vol 2008 (52) ◽  
pp. 77-91
Author(s):  
Cerasela Voiculescu
Keyword(s):  
Social Relations ◽  
Agricultural Policy ◽  
Rural Landscape ◽  
New Class ◽  
Long Run ◽  
Complex Relationships ◽  
The Impact ◽  
The Eu ◽  
Socialism And Postsocialism

This article explores the recent transformations of the Romanian peasantry and critically discusses interpretations of these changes as either indicating the persistence or the disappearance of peasants in Romania. It shows that beyond the labels of depeasantization and repeasantization, which are extensively used to describe rural scenarios under socialism and postsocialism, it is important to take analytic account of the more complex social relations between different actors that are developing under the impact of interacting local and global processes. Given the sharp differences between peasants and the new class of agricultural rentiers, as well as the variations within the latter group, the different rent regimes in which peasants negotiate their control over land and subsistence involve complex relationships and statuses. The article concludes by hypothesizing possible ways in which all of these relationships could be transformed in the long run in the new context of the EU agricultural policy and by discussing two possible scenarios for the Romanian rural landscape, namely, those of peripheral and nonperipheral capitalism.

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