Chu, Amanda M.Y. and Lv, Zhihui and Wagner, Niklas F. and Wong, Wing-Keung (2020): Linear and Nonlinear Growth Determinants: The Case of Mongolia and its Connection to China.
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Abstract
We investigate growth determinants for Mongolia as a small emerging economy considering China as its large neighbor. Our causality analysis during January 1992 to August 2017 reveals significant linear and nonlinear relationships in growth explanation. China’s GDP and coal prices, together with some of their linear and nonlinear lagged components, predict Mongolia’s GDP, where a one percent increase in China’s GDP relates to an increase in Mongolia of 1.5 percent. Current exchange rates and the nonlinear components of lagged levels of consumer prices also explain growth. Our results underline the role of macroeconomic drivers of growth in emerging economies.
Item Type: | MPRA Paper |
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Original Title: | Linear and Nonlinear Growth Determinants: The Case of Mongolia and its Connection to China |
Language: | English |
Keywords: | gross domestic product (GDP); economic growth; energy prices; coal prices; consumer prices; foreign direct investment (FDI); exchange rates; cointegration; multivariate Granger causality; nonlinear Granger causality; |
Subjects: | C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C53 - Forecasting and Prediction Methods ; Simulation Methods E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F42 - International Policy Coordination and Transmission |
Item ID: | 99185 |
Depositing User: | Wing-Keung Wong |
Date Deposited: | 23 Mar 2020 08:43 |
Last Modified: | 23 Mar 2020 08:43 |
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URI: | https://mpra.ub.uni-muenchen.de/id/eprint/99185 |