A major empirical interest is whether a permanent change in economic fundamentals produces a growth effect. However, a direct time series analysis of this hypothesis may not always be feasible due to a lack of such events. This paper explains why a test regarding the long run effect of a...

We develop a ten variable structural VAR model of the Australian economy for the period 1980 to 1995. The VAR methodology has not been widely applied in the Australian context, despite its popularity in quantitative macroeconomics internationally.