Question

In: Economics

Do a VECM analysis in STATA by using the variables FDI, GDP, Trade openness, and Exchange...

Do a VECM analysis in STATA by using the variables FDI, GDP, Trade openness, and Exchange rate. FDI is chosen as the dependent variable.
Indicate the commands for the stationarity, lag choice, and model stability.
Provide the Impulse Response Functions where FDI is the response function.

year fdi_inflow gdpcurrentus exportimport exneer exchangerate imf_gdpgrowth
1980 18000000 6.88E+13 3,679,337 1177121 84.8 -779
1981 95000000 7.10E+13 5,264,455 961635.3 81.88 4,365
1982 55000000 6.46E+13 6,498,011 745894.3 71.79 3,429
1983 46000000 6.17E+13 6,202,309 597710 73.95 4,758
1984 1.13E+11 6.00E+13 6,631,572 417444.8 67.54 6,823
1985 99000000 6.72E+13 7,015,557 315436.7 70.84 4,258
1986 1.25E+11 7.57E+13 6,714,885 204526 58.72 6,941
1987 1.15E+11 8.72E+13 7,197,477 144375.8 53.64 10,027
1988 3.54E+11 9.09E+13 8,135,124 85744.17 52.89 2,121
1989 6.63E+11 1.07E+14 736,106 61377.55 58.31 253
1990 6.84E+11 1.51E+14 5,810,786 46146.9 66.53 9,255
1991 8.10E+11 1.50E+14 6,458,618 29789.26 67.31 926
1992 8.44E+11 1.59E+14 6,433,734 17731.78 64.93 5,984
1993 6.36E+11 1.80E+14 5,214,379 12365.01 72.31 8,042
1994 6.08E+11 1.31E+14 7,780,772 4567.87 52.74 -5,456
1995 8.85E+11 1.70E+14 6,059,266 2776.45 58.7 719
1996 7.22E+11 1.82E+14 5,323,459 1604.04 59.3 7,007
1997 8.05E+11 1.90E+14 5,408,106 944.86 63.34 7,528
1998 9.40E+11 2.69E+14 5,873,941 573.48 69.54 3,092
1999 7.83E+11 2.50E+14 6,537,102 365 71.77 -3,389
2000 9.82E+11 2.67E+14 5,096,049 268.71 80.15 664
2001 3.35E+12 1.96E+14 7,568,819 142.44 63.98 -5,962
2002 1.08E+12 2.33E+14 6,994,458 113.54 72.46 643
2003 1.70E+12 3.03E+14 6,814,688 100.74 78.94 5,608
2004 2.79E+12 3.92E+14 6,476,041 98.57 82.1 9,644
2005 1.00E+13 4.83E+14 6,292,181 104.17 91.65 901
2006 2.02E+13 5.31E+14 6,128,172 97.33 91.62 711
2007 2.21E+13 6.47E+14 6,307,776 100 100 503
2008 1.99E+13 7.30E+14 6,537,179 96.29 102.47 845
2009 8.59E+12 6.15E+14 7,247,836 85.41 95.73 -4,704
2010 9.10E+12 7.31E+14 613,779 89.42 106.72 8,487
2011 1.62E+13 7.75E+14 5,601,475 76.8 94.67 11,113
2012 1.36E+13 7.89E+14 6,445,355 75.69 98.96 479
2013 1.29E+13 8.23E+14 6,032,023 71.08 97.88 8,491
2014 1.28E+13 7.99E+14 6,508,054 62.34 92.23 5,167

Solutions

Expert Solution

Error Correction term D_fdi_inflow | _ce1 | L1 is negative i.e -.5450331 but its significant which is less than 5% that why there is a long run casuality running from GDP, Export & Import and Exchange rate to FDI

but all the shrot run independent variable coefficient are insignificant because all the p value are greater than 5 % .

Rahul Sunny answered 1 year ago
Next > < Previous

Related Solutions

Alternative ways to calculate openness other than using trade flows?
Alternative ways to calculate openness other than using trade flows?
What are the alternative ways to calculate openness other than using trade flows? Justify it.
What are the alternative ways to calculate openness other than using trade flows? Justify it.
If most economists agree that trade openness is good for growth, why do many governments resist...
If most economists agree that trade openness is good for growth, why do many governments resist liberalising trade? Relate your answer to the ideas of Joseph Schumpeter. It may help to discuss some of the channels through which trade liberalization enhances efficiency. [15 marks]
Use the national macroeconomic variables such as GDP growth, inflation, exchange rate and cash rate as...
Use the national macroeconomic variables such as GDP growth, inflation, exchange rate and cash rate as the basis for describing the Australian economy over the last three years using quarterly or monthly data, and its likely development. This will be assessed according to both data acquisition and analytical capacity
Use the national macroeconomic variables such as GDP growth, inflation, exchange rate and cash rate as...
Use the national macroeconomic variables such as GDP growth, inflation, exchange rate and cash rate as the basis for describing the Australian economy over the last three years using quarterly or monthly data, and its likely development. This will be assessed according to both data acquisition and analytical capacity
How does the foreign exchange rate and supply theory affect gdp in relation to trade and...
How does the foreign exchange rate and supply theory affect gdp in relation to trade and government debt?
Explain the connection between these variables; real GDP growth, inflation rate, government budget balance, exchange rate,...
Explain the connection between these variables; real GDP growth, inflation rate, government budget balance, exchange rate, private investment and trade balance from year 2007-2016. in Tonga commentary with macro relationships
A study modeled the GDP per capita of 24 countries using the variables Regulation Index, an...
A study modeled the GDP per capita of 24 countries using the variables Regulation Index, an index of Ethnolinguistic Diversity, International Trade as a share of GDP, Primary Education rate in %, and 1988 GDP/Capita. Parts of the regression output are shown below. Dependent variable is: GDP/Capita s = 2102 Source Sum of Squares df Mean Square Fratio Regression 2,740,849,111 5 548,169,822 124 Residual 79,502,035 18 4,416,780 Variable Coefficent SE Coeff T-ratio Intercept 10,744.5 9425 1.14 Regulation Index -1334.98 615.2...
Multivariate analysis Using the data provided, perform the following analysis: Determine the explanatory and response variables....
Multivariate analysis Using the data provided, perform the following analysis: Determine the explanatory and response variables. Run a multivariate regression analysis on all three variables. Interpret the results by answering the following questions: What is the calculated correlation coefficient? Do the sales figures correlate with the marketing expenditure and price? Comment on the coefficient of determination. What percentage of the response data can be explained by the explanatory variables? Determine the multiple regression line equation in the form: sales^ =...
Conduct an economic analysis on England. Talk about GDP, Brexit, Consumer springing habits, exchange rates, and...
Conduct an economic analysis on England. Talk about GDP, Brexit, Consumer springing habits, exchange rates, and other important factors. Must be in essay format. Two pages.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT