Sources of economic fuctuations in France: A structural VAR model

Artikel

This paper studies the economic fluctuations of an open economy such as the French economy. A system of variables containing output, price level, trade balance, real exchange rate and oil prices is analyzed by applying the structural vector autoregressive (SVAR) methodology initiated by Sims (1980). This set of variables allows to evaluate the main sources of impulses of the French economy fluctuations. The results show that five structural shocks are identified using the long-run constraints implemented by Blanchard and Quah (1989). From the SVAR dynamic properties, impulse response functions and variance decomposition, the French economy is shown to be particularly vulnerable to supply and oil price shocks, where these two shocks respectively contribute to 40% and 35% of the economic disturbance. France is also hit by important external shocks which damage its trade balance position. Finally, it is found that shocks related to economic policy (demand shocks) have a quite limited impact on the economic activity.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: European Journal of Government and Economics (EJGE) ; ISSN: 2254-7088 ; Volume: 1 ; Year: 2012 ; Issue: 1 ; Pages: 66-85 ; A Coruña: Universidade da Coruña

Classification and Topics

• Classification: Wirtschaft
• Subject: economic fluctuations ; external shocks ; internal shocks ; oil price shock ; SVAR model

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ben Arfa, Nabil
• Event: Veröffentlichung
• (who): Universidade da Coruña
• (where): A Coruña
• (when): 2012

Further information

• DOI: doi:10.17979/ejge.2012.1.1.4277
• Handle: http://hdl.handle.net/10419/217708
• Last update: 10.03.2025, 11:45 AM CET