CONCLUSIONS FOR AGRICULTURAL PRACTICE, POLICY AND DEVELOPMENT

Agricultural and Food Policy,

Is there Really a Unit Root in the Inflation Rate? More Evidence from Panel Data Models

Time series unit root evidence suggests that inflation is nonstationary. By contrast, when using more powerful panel unit root tests, Culver and Papell (1997) find that inflation is stationary. In this paper, we test the robustness of this result by applying a battery of recent panel unit root tests. The results suggest that the stationarity of inflation holds even after controlling for crosssectional dependence and structural change.Unit Root; Inflation; Cross-Sectional Dependence; Structural Change

Mixed Signals Among Tests for Panel Cointegration

In this paper, we study the effect that different serial correlation adjustment methods can have on panel cointegration testing. As an example, we consider the very popular tests developed by Pedroni (1999, 2004). Results based on both simulated and real data suggest that different adjustment methods can lead to significant variations in test outcome, and thus also in the conclusions.Panel Data; Cointegration Testing; Parametric and Semiparametric Methods

The long-run relationship between savings and investment in oil-exporting developing countries: A case study of the Gulf Arab States

The relationship between national saving and investment over the long term is examined for six Gulf Arab oil-exporting developing countries -- Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. We show that, provided some large outliers are properly accounted for, long-run equilibrium relationships between saving and investment (both total and fixed) exist in these countries. Since these countries have typically large current account surpluses such relationships cannot be explained by standard arguments. Our hypothesis is that the response of investment to saving largely depends on domestic absorptive capacity.Saving-investment correlation; oil-exporting developing countries; GCC countries; absorptive capacity; outlier detection; integrated process.

The long-term decline of internal migration in Canada – Ontario as a case study

Migration between the Canadian provinces generally followed a declining trend over the period 1971-2004. In this paper, taking Ontario a case study, we seek to explain these patterns using recent panel cointegration methods that are robust to cross-section dependence. Estimation of heterogenous models suggests that the determinants of migration vary across provinces. Overall, unemployment differential and income in the sending province appear to be the most important ones, with income and federal transfer differentials playing only a minor role.Internal migration; panel cointegration; bootstrap; Canada

"PPP tests in cointegrated panels: Evidence from Asian developing countries".

This paper tests the relative version of purchasing power parity (PPP) for a set of ten Asian developing countries using panel cointegration framework. We employ 'between-dimension' dynamic OLS estimator as proposed by Pedroni (2001b). The test results overwhelmingly reject the PPP hypothesis.Purchasing Power Parity, Panel Cointegration, Unit Root

Total ozone measurement: Intercomparison of prototype New Zealand filter instrument and Dobson spectrophotometer

A five month intercomparison showed that the total ozone amounts of a prototype narrowband interference filter instrument were 7% less than those of a Dobson instrument for an ozone range of 0.300 to 0.500 atm cm and for airmasses less than two. The 7% bias was within the intercomparison calibration uncertainty. An airmass dependence in the Dobson instrument made the bias relationship airmass-dependent but the filter instrument's ozone values were generally constant to 2% up to an airmass of four. Long term drift in the bias was negligible

Has the non-oil sector decoupled from oil sector? A case study of Gulf Cooperation Council Countries

As oil and gas are exhaustible resources, the need for economic diversification has gained momentum in the Gulf Cooperation Council (GCC) countries immediately after the end of the first oil boom in 1973-74. Economic diversification, in the context of GCC countries, implies development of the non-oil sector and reduction of the proportion of government revenue and export proceeds from the oil and gas sector. Applying newly developed measures of business cycle synchronicity between oil and non-oil sectors in three GCC economies (Kuwait, Qatar and Saudi Arabia), we show both the degree of diversification achieved so far and the direction of diversification in terms of individual non-oil sectors. Overall, Kuwait and Saudi Arabia appear to be moderately ahead than Qatar in reducing their dependence on oil. Nevertheless, by developing large production capacities of natural gas, Qatar has recently reduced its dependence on oil in favor of natural gas. A quantitative assessment of the determinants of business cycle synchronization is also provided.Business cycle; Synchronization; Oil price; Fiscal policy; GCC countries

Country Heterogeneity and Long-Run Determinants of Inflation in the Gulf Arab States

Applying nonstationary panel data econometric methods, this paper analyzes the major sources and transmission of inflation in the Gulf Cooperation Council (GCC) countries over the 1980-2008 period. We argue that, in GCC countries, money is essentially demand determined, so that the high collinearity between money and aggregate demand indicators such as non-hydrocarbon output is expected and should be dealt with accordingly. Several important results emerge from the analysis. First, the money supply stands out as a significant determinant of inflation both in short- and long-run. Both foreign prices and the nominal effective exchange rate are shown to be more successful in explaining inflation in the long-run than the short-run. The half-life of the speed of adjustment reveals that it takes about 2.9 years for 50% of a shock to the long-run equilibrium to dissipate. An implication of our results is the case it makes for more sovereign monetary policies in GCC countries.Inflation, Monetary policy, Fiscal policy, Exchange rates, Oil price, Panel data.

Channels of risk-sharing among Canadian provinces: 1961–2006

This paper incorporates recent developments in the literature to quantify the amount of interprovincial risk-sharing in Canada. We find that both capital market and the federal tax-transfer system play an almost equally important role (about 26 percent each) in smoothing shocks to gross provincial product, while only 18 percent of shocks are smoothed by credit markets. The remaining 30 percent are not smoothed. Our results bring to light the critical role that Alberta plays in trading-off credit market smoothing for more capital market risk-sharing to the rest of Canada. Our pairwise risk-sharing analysis has brought up some interesting questions and arguments that are often neglected in discussions of regional risk-sharing. For example, one aspect of the pairwise analysis sheds light on the assessment of the economic effects of Quebec separation.Risk-sharing; pairwise risk-sharing; federal taxes and transfer; panel data; cross-section dependence.