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An empirical analysis of sustainability of trade deficit: evidence from Sri Lanka

Journal Article


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Abstract


  • In this paper, the long-run relationship between Sri Lankan exports

    and imports during the period 1950 to 2006 is examined using unit

    root tests and cointegration techniques that allow for an

    endogenously determined structural break. The results failed to

    support the existence of a long-run equilibrium between exports and

    imports in Sri Lanka. This finding questions the effectiveness of Sri

    Lankas current long-term macroeconomic policies and suggests that

    Sri Lanka is in violation of its international budget constraint

Publication Date


  • 2008

Citation


  • Perera, N. & Verma, R. (2008). An empirical analysis of sustainability of trade deficit: evidence from Sri Lanka. International Journal of Applied Econometrics and Quantitative Studies, 5 (1), 79-92.

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1514&context=commpapers

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/478

Number Of Pages


  • 13

Start Page


  • 79

End Page


  • 92

Volume


  • 5

Issue


  • 1

Abstract


  • In this paper, the long-run relationship between Sri Lankan exports

    and imports during the period 1950 to 2006 is examined using unit

    root tests and cointegration techniques that allow for an

    endogenously determined structural break. The results failed to

    support the existence of a long-run equilibrium between exports and

    imports in Sri Lanka. This finding questions the effectiveness of Sri

    Lankas current long-term macroeconomic policies and suggests that

    Sri Lanka is in violation of its international budget constraint

Publication Date


  • 2008

Citation


  • Perera, N. & Verma, R. (2008). An empirical analysis of sustainability of trade deficit: evidence from Sri Lanka. International Journal of Applied Econometrics and Quantitative Studies, 5 (1), 79-92.

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1514&context=commpapers

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/478

Number Of Pages


  • 13

Start Page


  • 79

End Page


  • 92

Volume


  • 5

Issue


  • 1