engleski

Cointegration, error correction model, and causality : evidence from food export of Croatia 1976-1996

Employing different representative approaches and modern time series methods, this study attempts to examine the prospective long-term relationship between Croatia's food export and worldwide food import during 1976-1996. We test if either Croatia's food export or worldwide food import leads to other. We find that both time series are cointegrated. Error correction models are formulated to test bidirectional causality between food exports of Croatia and worldwide food import. For food exports, there is hard evidence of one-directional causality, supporting the paradoxically hypotheses that Croatia (as a small country) food export does cause worldwide food import, but there is not strong evidence of causality in vice versa direction.

food; import; export; Croatia; world; ECM; Granger causality

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