Empirical findings: estimates of equation (2)
| Variable/Model | Parameter | (2) | (2b) | (2c) | (2d) | (2e) |
|---|---|---|---|---|---|---|
| Public investment | Long-run | 0.54*** [0.14] | 0.43*** [0.14] | 0.66*** [0.15] | 0.49*** [0.16] | 0.67*** [0.18] |
| Short-run | 0.54*** [0.14] | 0.43*** [0.14] | 0.66*** [0.15] | 0.49** [0.16] | 0.67*** [0.18] | |
| Demand growth | Long-run | 0.11 [0.16] | 0.48** [0.18] | 0.04 [0.16] | 0.41* [0.21] | 0.04 [0.19] |
| Short-run | 2.16*** [0.16] | 2.27*** [0.18] | 2.17*** [0.16] | 2.26*** [0.21] | 2.24*** [0.19] | |
| Inflation rate | Long-run | −0.04* [0.02] | −0.02 [0.02] | −0.03 [0.02] | −0.02 [0.02] | −0.03 [0.02] |
| Short-run | −0.04* [0.02] | −0.02 [0.02] | −0.03 [0.02] | −0.02 [0.02] | −0.03 [0.02] | |
| Terms of trade | Long-run | 0.77** [0.29] | 0.68** [0.31] | |||
| Short-run | 0.77 ** [0.29] | 0.68** [0.31] | ||||
| Real exchange rate | Long-run | 0.16 [0.30] | ||||
| Short-run | −0.12 [0.30] | |||||
| Labor cost | Long-run | −0.34* [0.19] | −0.13 [0.18] | −0.40* [0.22] | ||
| Short-run | −0.34* [0.19] | −0.13 [0.18] | −0.40* [0.22] | |||
| Best model | (1, 0, 2, 0) | (1, 0, 2, 0, 0) | (1, 0, 2, 0, 0) | (1, 0, 2, 0, 0, 0) | (1, 0, 2, 0, 3, 0) | |
| BG test (p-value) | 0.70 | 0.28 | 0.50 | 0.25 | 0.59 | |
| Bound F-test | 0.08 | 0.00 | 0.04 | 0.01 | 0.10 | |
| Ect. (p-value) | −0.49*** [0.12] | −0.53*** [0.11] | −0.49*** [0.12] | −0.52*** [0.11] | −0.44*** [0.11] | |
| Variable/Model | (2) | (2b) | (2c) | (2d) | (2e) | |
|---|---|---|---|---|---|---|
| Public investment | 0.54*** [0.14] | 0.43*** [0.14] | 0.66*** [0.15] | 0.49*** [0.16] | 0.67*** [0.18] | |
| 0.54*** [0.14] | 0.43*** [0.14] | 0.66*** [0.15] | 0.49** [0.16] | 0.67*** [0.18] | ||
| Demand growth | 0.11 [0.16] | 0.48** [0.18] | 0.04 [0.16] | 0.41* [0.21] | 0.04 [0.19] | |
| 2.16*** [0.16] | 2.27*** [0.18] | 2.17*** [0.16] | 2.26*** [0.21] | 2.24*** [0.19] | ||
| Inflation rate | −0.04* [0.02] | −0.02 [0.02] | −0.03 [0.02] | −0.02 [0.02] | −0.03 [0.02] | |
| −0.04* [0.02] | −0.02 [0.02] | −0.03 [0.02] | −0.02 [0.02] | −0.03 [0.02] | ||
| Terms of trade | 0.77** [0.29] | 0.68** [0.31] | ||||
| 0.77 ** [0.29] | 0.68** [0.31] | |||||
| Real exchange rate | 0.16 [0.30] | |||||
| −0.12 [0.30] | ||||||
| Labor cost | −0.34* [0.19] | −0.13 [0.18] | −0.40* [0.22] | |||
| −0.34* [0.19] | −0.13 [0.18] | −0.40* [0.22] | ||||
| Best model | (1, 0, 2, 0) | (1, 0, 2, 0, 0) | (1, 0, 2, 0, 0) | (1, 0, 2, 0, 0, 0) | (1, 0, 2, 0, 3, 0) | |
| BG test (p-value) | 0.70 | 0.28 | 0.50 | 0.25 | 0.59 | |
| Bound | 0.08 | 0.00 | 0.04 | 0.01 | 0.10 | |
| Ect. ( | −0.49*** [0.12] | −0.53*** [0.11] | −0.49*** [0.12] | −0.52*** [0.11] | −0.44*** [0.11] | |
Note(s): (a) Standard errors are in brackets; (b) regressions were performed with the introduction of a time trend; (c) the intercept and trend parameters are not presented due to limited space, but are available upon request; (d) *, ** and *** mean, respectively, statically significant at 10, 5 and 1% and (e) the lag for each variable utilized in our regressions was determined based on the Akaike information criterion (AIC)
Source(s): Table by authors
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