: This article provides an overview of both theoretical and empirical literature on the link between public investment (capital) and economic growth (national income). We first survey the channels through which public capital can conceivably affect growth. We then turn to reviewing the existing empirical literature, and we conclude that although not all studies find a growth-enhancing effect of public capital, there is now more consensus than in the past that public capital furthers economic growth. However, the impact reported by recent studies is not as big as some earlier studies suggested. We conclude with an overview of what is known about the optimality of public capital stocks.

/pdf/public-capital-and-economic-growth-a-critical-survey-33ib460nn5.pdf

Public Capital and Economic Growth: A Critical Survey

The economic development and growth literature contains extensive discussions on relationships between exports and economic growth. One debate centres on whether countries should promote the export sector to obtain economic growth. An abundant empirical literature on this export-led growth (ELG) hypothesis has followed. We aim to contribute to this literature in two ways. In this paper, part 1, we provide a comprehensive survey of more than 150 export-growth applied papers. We describe the changes that have occurred, over the last two decades, in the methodologies used empirically to examine for relationships between exports and economic growth, and we provide information on the current findings.The last decade has seen an abundance of time series studies that focus on examining for causality via exclusions restrictions tests, impulse response function analysis and forecast error variance decompositions. Our second contribution is to examine some of these time series methods. We show, in part 2, that ELG ...

/pdf/export-led-growth-a-survey-of-the-empirical-literature-and-47ss4xazqa.pdf

Export-led growth: a survey of the empirical literature and some non-causality results. Part 1

Rethinking the global food crisis: The role of trade shocks

Cheap food has been taken for granted for almost 30 years. From their peak in the 1970s crisis, real food prices steadily declined in the 1980s and 1990s and eventually reached an all-time low in the early 2000s. Rich and poor governments alike therefore saw little need to invest in agricultural production, and reliance on food imports appeared to be a relatively safe and efficient means of achieving national food security. However, as the international prices of major food cereals surged upward from 2006 to 2008 these perceptions quickly collapsed. Furthermore, although food prices are now lower than their 2008 peak, real prices have remained significantly higher in 2009 and 2010 than they were prior to the crisis, and various simulation models predict that real food prices will remain high until at least the end of the next decade.

Reflections on the Global Food Crisis: how did it happen? how has it hurt? and how can we prevent the next one?

Oxford Bulletin of Economics and Statistics

Summary
This study examines the linkages between public investments and private investments by using Granger-causality and cointegration tests and probit analysis in a sample of 25 developing countries. The results from the cointegration and Granger-causality tests are further analysed in a probit framework by assigning the dependent variable the value ‘1’ for the ‘crowding-out’ cases and ‘0’ otherwise, and the explanatory variables are various components of Gwartney and Lawson's (2004) economic freedom of the world index. Using this approach, we find that the higher the share of government involvement in an economy, the lower the trade openness; the more restrictions there are on the use of foreign currencies, and the more stable and developed the macro and monetary environment is, the higher the likelihood that public investments may crowd out private investments. The model correctly predicts 10 out of 11 cases of crowding-out and 13 out of 14 cases of no-crowding-out.

/pdf/interactions-between-public-and-private-investment-evidence-4yiivh2hp5.pdf

Interactions Between Public and Private Investment: Evidence from Developing Countries

Return and volatility spillovers among CIVETS stock markets

Taking Turkey’s experience as a case study, this study provides further insights into the evaluation of time-varying Granger-causal relationships in the trade openness and economic performance nexus. We reinvestigated the Granger-causal relationships between trade openness and real economic growth in Turkey for the time period 1950–2014. We employed a rolling version of Breitung and Candelon’s frequency domain Granger-causality test, which allowed us to identify the changes in the nature of the causal relationships overtime. Hence, in the face of different results found in the literature overtime, our study provides a more unified evidence on the relationship between trade openness and real economic growth in Turkey. In addition, we found empirical evidence for the possibility of a distinct temporal ordering in a feedback relationship between trade openness and economic growth. We called this situation “sequential feedback”.

Trade Openness and Economic Growth in Turkey: A Rolling Frequency Domain Analysis

Investing in art objects yields financial and psychic returns The psychic returns arise since art has a superior consumption good aspect as well The question is whether it is possible to measure the psychic returns One valuation method for estimating the psychic returns to investing in artworks is their rental price Here, we make use of the prices charged by a Canadian fine art company for its art rental services and calculate the implied psychic returns to be about 28 percent Next, we review the finance-theoretic approaches to measuring the psychic returns to investing in artworks We follow Hodgson and Vorkink's (2004, Canadian Journal of Economics) suggestion that the alpha parameter in the CAPM captures the extent of net psychic returns The evidence on alpha from the art market applications of the CAPM coupled with the transaction cost data from international art auctions also suggests that the psychic returns to investing in artworks might amount to about 28 per cent

/pdf/on-the-valuation-of-psychic-returns-to-art-market-1ddm4jnn86.pdf

On the valuation of psychic returns to art market investments

This article presents evidence in favour of time-varying Markov regime-Switching (MS) properties in all shares stock returns in the USA. The model specifications include the US Institute for Supply Management's (ISM) manufacturing and Nonmanufacturing Business Activity Index (NMBAI) in the transition equations. We find that the developments in the ISM manufacturing index affect the regime-switching probabilities in both bull and bear stock market periods. The business activity in nonmanufacturing sectors, on the other hand, has a bearing only on bull market periods. We also test for the possibility of a common factor influencing both stock returns and business confidence in the manufacturing sector by estimating a time-varying MS model with the US industrial production in the transition equation. We find that the null hypothesis of a fixed transition probability MS model cannot be rejected when the US industrial production index is included in the transition equation of a time-varying MS model. We conclud...

Erdal Atukeren

Papers

Interactions Between Public and Private Investment: Evidence from Developing Countries

Return and volatility spillovers among CIVETS stock markets

Trade Openness and Economic Growth in Turkey: A Rolling Frequency Domain Analysis

On the valuation of psychic returns to art market investments

Business confidence and stock returns in the USA: a time-varying Markov regime-switching model