A dynamic factor model for the Mexican economy: are common trends useful when predicting economic activity?
In this paper Francisco Corona, Graciela González-Farías and Pedro Orraca propose to use the common trends of the Mexican economy in order to predict economic activity one and two steps ahead. We exploit the cointegration properties of the macroeconomic time series, such that, when the series are I(1) and cointegrated, there is a factor representation, where
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Purchasing power parity in Mexico since 1933
A new approach to cointegration developed by Enders et al. (Cointegration tests using instrumental variables with an example of the U.K. demand for money. Unpublished working paper written by Frederick H. Wallace. http://wenders.people.ua.edu/time-series-methods.html, 2008) is applied to long-span, high-frequency data to test for purchasing power parity in the Mexico–US real exchange rate. Overall the empirical
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The rise and fall of income inequality in Chile
This paper written by Francisco Parro and Loreto Reyes presents evidence on a rise and fall in income inequality in Chile during the past two decades. We show that income inequality rises from 1990 to 2000 and then falls from 2000 to 2011. We perform simple but informative decompositions to figure out the contributing factors
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Defence expenditure and economic growth in Latin American countries: evidence from linear and nonlinear causality tests
Using SIPRI’s new consistent database on military expenditures, the paper written by Christos Kollias, Suzanna-Maria Paleologou, Panayiotis Tzeremes and Nickolaos Tzeremes, examines the economic effects of such spending in the case of the 13 Latin American countries. Employing both linear and nonlinear tests, the nexus between defence spending, economic growth, and investment is investigated for the
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Changes in rural poverty in Perú 2004–2012
This paper written by Samuel Morley disaggregates the various sources of rural income growth in Peru between 2004 and 2012 and shows that about 80% of the increase came from rising earnings and only 15% from transfer programs. This increase in rural earnings was not led by agriculture. It was mainly because of a general rise
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The economic integration of Spain: a change in the inflation pattern
The behavior of Spanish inflation rates at the provincial level (consumption prices) differs over the two spans of time considered in our study (1955.1–1978.6, 1978.7–2014.4). Alejandro C. García-Cintado, Diego Romero-Ávila and Carlos Usabiaga point to a long list of institutional and economic changes, at national and international levels, as the potential factors that might have led
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