This paper examines the relevance of the Balassa-Samuelson productivity-bias hypothesis for explaining long-run permanent shocks in the real exchange rates. The sample consists of yearly data on real exchange rates and productivity for six OECD countries. On the basis of Johansens maximum...

This paper investigates Balassa's export-led growth hypothesis for Greece, Ireland, Mexico, Portugal and Turkey by constructing a vector autoregression (VAR) model. On the basis of the Granger non-causality procedure developed by Toda and Yamamoto (1995), the results show that export and output...

The aim of this study is to investigate empirically the underlying nexus of stock market returns and volatility in the Gulf Cooperation Council (GCC) countries and Middle East and North Africa (MENA) region by using the GARCH-M model. We find that volatility is time-varying in all countries,...

Purpose – In the literature on the effects of economic globalization, the compensation hypothesis suggests that there is a positive link between government size and external risk as governments perform a risk mitigating role to insure against productivity shocks through transfers. In contrast,...