| Author (Person) | Iseringhausen, Martin, Vierke, Hauke |
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| Author (Corporate) | European Commission: DG Economic and Financial Affairs |
| Publisher | Publications Office of the European Union |
| Series Title | European Economy: Discussion Papers |
| Series Details | Number 75 |
| Publication Date | 17/01/2018 |
| ISBN | 978-92-79-77405-8 |
| ISSN | 2443-8022 |
| Content Type | Research Paper |
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Summary: This paper studies the determinants of output volatility in a panel of 22 OECD countries. In contrast to the existing literature, we avoid ad hoc estimates of volatility based on rolling windows, and we account for possible non-stationarity of the data. Specifically, output volatility is estimated by means of an unobserved components model where the volatility series is the outcome of both macroeconomic determinants and a latent integrated process. A Bayesian model selection is performed to test for the presence of the nonstationary component. The results point to demographics and government size as important determinants of macroeconomic (in)stability. In particular, a larger share of prime-age workers is associated with lower output volatility, while higher public expenditure increases volatility. |
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| Source Link |
Link to Main Source
https://ec.europa.eu/info/publications/what-drives-output-volatility-role-demographics-and-government-size-revisited_en
Alternative sources
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| Subject Categories | Economic and Financial Affairs |
| Keywords | Demographics, Output Volatility |
| International Organisations | Organisation for Economic Co-operation and Development [OECD] |
