DP230 An Econometric Investigation of North-South Interdependence

Author(s): Michael Beenstock
Publication Date: March 1988
Keyword(s): Dutch Disease, Feedback Effects, LDCs, North-South interdependence, Simulation
JEL(s): 123, 131, 133, 423
Programme Areas: International Macroeconomics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=230

In Centre for Economic Policy Research Discussion Paper Nos. 164 and 165 I presented econometric models of the industrialized countries (North) and the oil-importing developing countries (South). This paper links the two models so that the economic interdependence between North and South can be investigated. A series of simulations are presented in which the effects of Northern shocks on the South are considered as well as the effects of Southern shocks on the North. The paper concludes with simulations that take account of feedback effects between North and South.