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Commodity terms of trade and individual countries' net barter terms of trade: Is there an empirical relationship?

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  • Matthias G. Lutz

    (Institute of Economics, University of St. Gallen, Switzerland)

Abstract

This paper examines the statistical relationship between aggregate commodity terms of trade and the net barter terms of trade of 66 non-oil developing countries. Stationarity of the estimated long-run equation is tested for each country using Engle-Granger ADF tests. Four different commodity terms of trade series are examined. For more than half the sample a stationary long-run relationship is detected. The responsiveness of the country terms of trade to the overall index varies considerably between countries. These findings suggest that the long-term trend in the overall terms of trade is still relevant to developing countries today. Copyright © 1999 John Wiley & Sons, Ltd.

Suggested Citation

  • Matthias G. Lutz, 1999. "Commodity terms of trade and individual countries' net barter terms of trade: Is there an empirical relationship?," Journal of International Development, John Wiley & Sons, Ltd., vol. 11(6), pages 859-870.
    • Handle: RePEc:wly:jintdv:v:11:y:1999:i:6:p:859-870
    DOI: 10.1002/(SICI)1099-1328(199909/10)11:6<859::AID-JID632>3.0.CO;2-H
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    References listed on IDEAS

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    3. Thomas H.W. Ziesemer, 2014. "Country terms of trade: trends, unit roots, over-differencing, endogeneity, time dummies, and heterogeneity," International Review of Applied Economics, Taylor & Francis Journals, vol. 28(6), pages 767-796, September.
    4. Hapau Razvan Gabriel, 2023. "Capital Market Volatility During Crises: Oil Price Insights, VIX Index, and Gold Price Analysis," Management & Marketing, Sciendo, vol. 18(3), pages 290-314, September.
    5. Konstantin M. Wacker, 2011. "The Impact of Foreign Direct Investment on Developing Countries’ Terms of Trade," WIDER Working Paper Series 006, World Institute for Development Economic Research (UNU-WIDER).
    6. Konstantin M. Wacker, 2011. "The Impact of Foreign Direct Investment on Developing Countries' Terms of Trade," WIDER Working Paper Series wp-2011-006, World Institute for Development Economic Research (UNU-WIDER).
    7. Richard Alioma & Manfred Zeller & Yee Khor Ling, 2022. "Analysis of long-term prices of micronutrient-dense and starchy staple foods in developing countries," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 10(1), pages 1-21, December.
    8. Surajit Deb, 2003. "Terms of Trade and Supply Response of Indian Agriculture: Analysis in Cointegration Framework," Working papers 115, Centre for Development Economics, Delhi School of Economics.
    9. Konstantin M. Wacker, 2011. "Do multinationals beat down developing countries' export prices? The impact of FDI on net barter terms of trade," Ibero America Institute for Econ. Research (IAI) Discussion Papers 211, Ibero-America Institute for Economic Research.
    10. Paul Newbold & Stephan Pfaffenzeller & Anthony Rayner, 2005. "How well are long-run commodity price series characterized by trend components?," Journal of International Development, John Wiley & Sons, Ltd., vol. 17(4), pages 479-494.
    11. Nunnenkamp, Peter, 2003. "Systemic factors and economic development in Islamic countries," Open Access Publications from Kiel Institute for the World Economy 4319, Kiel Institute for the World Economy (IfW Kiel).
    12. Anu Keshiro Toriola & Emmanuel Oladapo George & Walid Gbadebo Adebosin, 2021. "The Nexus Between Commodity Terms and National Terms of Trade of Sub-Sahara African Countries: Implication for Intersectoral Linkage," South-Eastern Europe Journal of Economics, Association of Economic Universities of South and Eastern Europe and the Black Sea Region, vol. 19(1), pages 79-98.
    13. Konstantin M. Wacker, 2016. "Do Multinationals Deteriorate Developing Countries' Export Prices? The Impact of FDI on Net Barter Terms of Trade," The World Economy, Wiley Blackwell, vol. 39(12), pages 1974-1999, December.

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