How did external and internal shocks affect Fiji? : an empirical study ; 1970 - 2008

Pacific island countries have been affected by the ongoing global economic downturn. The impact of recessionary effects has not been uniform as the degree of global interdependence varies amongst Pacific island countries. By employing a vector autoregression (VAR) model, this paper investigates the impact of shocks, both domestic and external, on Fijis output during a 39-year period. The study findings suggest that domestic shocks are more important than regional and global shocks in affecting the economic performance of Fiji.