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Is there a long-run relationship between exports and imports in Chile?

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  • Dierk Herzer
  • Nowak-Lehmann Felicitas

Abstract

This study examines the long-run relationship between Chilean exports and imports during the 1975 to 2004 period using unit root tests and cointegration techniques that allow for endogenously determined structural breaks. The results indicate that there exists a long-run equilibrium between exports and imports in Chile, despite the balance-of-payments crisis of 1982/83. This finding implies that Chile's macroeconomic policies have been effective in the long-run and suggests that Chile is not in violation of its international budget constraint.

Suggested Citation

  • Dierk Herzer & Nowak-Lehmann Felicitas, 2006. "Is there a long-run relationship between exports and imports in Chile?," Applied Economics Letters, Taylor & Francis Journals, vol. 13(15), pages 981-986.
    • Handle: RePEc:taf:apeclt:v:13:y:2006:i:15:p:981-986
    DOI: 10.1080/13504850500425832
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