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The Long Run Behavior of The Terms of Trade Between Primary Commodities and Manufactures: A Panel Data Approach

Serie

  • 87th Annual Conference, April 8-10, 2013, Warwick University, Coventry, UK

Resumen

  • This paper examines the Prebisch and Singer hypothesis using a panel of twenty-four commodity prices from 1900 to 2010. The modelling approach stems from the need to meet two key concerns: i.) the presence of cross-sectional dependence among commodity prices; and ii.) the identification of potential structural breaks. To address these concerns, the Hadri and Rao (2008) test is employed. The findings suggest that all commodity prices exhibit a structural break whose location differs across series, and that support for the Prebisch and Singer hypothesis is mixed. Once the breaks are removed from the underlying series, the persistence of commodity price shocks is shorter than that obtained in other studies using alternative methodologies.

fecha de publicación

  • 2013

Líneas de investigación

  • Demand and Price Analysis
  • Environmental Economics and Policy

Issue

  • 158682