Search for other papers by José A. Pérez-Montiel in
Current site
Google Scholar
PubMed
Search for other papers by Carles Manera Erbina in
Current site
Google Scholar
PubMed
This paper tests the main postulates of the Sraffian supermultiplier model for the case of 16 European economies during the period 1995–2018. We adopt the methodology of and extend it to a panel framework. We apply panel unit root, cointegration, and causality tests that are robust to endogenous regressors, cross-sectional dependence and heterogeneity across countries. Our results are supportive of the Sraffian supermultiplier model. In a heterogeneous panel framework, autonomous demand and output follow a long-run equilibrium relationship and there exists panel long-run causality that goes unidirectionally from autonomous demand to output. We also empirically verify the investment accelerator (the mechanism that enables the dynamic stability of the model) by confirming the existence of same-sign panel causality running unidirectionally from the growth rate of autonomous demand to the investment share. Our results call for national economic policies aimed at promoting the components of autonomous demand that act as locomotives of growth in each country.
Purchase
Pay to Access Content (PDF download and unlimited online access)
Institutional Login
Log in with Open Athens, Shibboleth, or your institutional credentials
Personal login
Log in with your Elgar Online account
- 1 INTRODUCTION
- 2 DATA AND METHODOLOGY FRAMEWORK
- 3 EMPIRICAL RESULTS
- Tests for cross-sectional dependence and for homogeneity
- Panel unit root tests: exogenous variables – individual effects
- Panel unit root tests: exogenous variables – individual effects and individual linear trends
- Pedroni (2004) heterogeneous panel cointegration test; dependent variable: GDP
- Panel long-run elasticity estimation results; dependent variable: GDP
- Canning and Pedroni (2008) heterogeneous panel long-run causality test
- Panel causality tests between h and gZ
- 4 CONCLUDING REMARKS
- FUNDING
- REFERENCES
| Since 2022 | Since May 2022 | Past 30 Days | |
|---|---|---|---|
| Abstract Views | 324 | 151 | 37 |
| Full Text Views | 11 | 5 | 0 |
| PDF Downloads | 15 | 5 | 0 |
