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Do Oil Prices Predict Economic Growth? New Global Evidence

Westerlund, Joakim LU ; Narayan, Paresh; Sharma, Susan and Poon, Wai Ching (2014) In Energy Economics 41(January). p.137-146
Abstract
In this paper, we test whether oil price predicts economic growth for 28 developed and 17 developing countries. We use predictability tests that account for the key features of the data, namely, persistency, endogeneity, and heteroskedasticity. Our analysis considers a large number of countries, shows evidence of more out-of-sample predictability with nominal than real oil prices, finds in-sample predictability to be independent of the use of nominal and real prices, and reveals greater evidence of predictability for developed countries.
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author
publishing date
type
Contribution to journal
publication status
published
subject
keywords
Economic growth, Predictability, Oil price
in
Energy Economics
volume
41
issue
January
pages
137 - 146
publisher
Elsevier
external identifiers
  • scopus:84890136644
ISSN
0140-9883
DOI
10.1016/j.eneco.2013.11.003
language
English
LU publication?
no
id
db327a69-4b46-4965-9ca9-776c2f19235a (old id 4588879)
alternative location
http://www.sciencedirect.com/science/article/pii/S0140988313002478
date added to LUP
2014-08-20 13:19:00
date last changed
2017-11-19 03:14:42
@article{db327a69-4b46-4965-9ca9-776c2f19235a,
  abstract     = {In this paper, we test whether oil price predicts economic growth for 28 developed and 17 developing countries. We use predictability tests that account for the key features of the data, namely, persistency, endogeneity, and heteroskedasticity. Our analysis considers a large number of countries, shows evidence of more out-of-sample predictability with nominal than real oil prices, finds in-sample predictability to be independent of the use of nominal and real prices, and reveals greater evidence of predictability for developed countries.},
  author       = {Westerlund, Joakim and Narayan, Paresh and Sharma, Susan and Poon, Wai Ching},
  issn         = {0140-9883},
  keyword      = {Economic growth,Predictability,Oil price},
  language     = {eng},
  number       = {January},
  pages        = {137--146},
  publisher    = {Elsevier},
  series       = {Energy Economics},
  title        = {Do Oil Prices Predict Economic Growth? New Global Evidence},
  url          = {http://dx.doi.org/10.1016/j.eneco.2013.11.003},
  volume       = {41},
  year         = {2014},
}