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Model evaluation and causality testing in short panels: the case of infrastructure provision and population growth in the Brazilian Amazon

Weinhold, Diana and Reis, Eustaquio J. (2001) Model evaluation and causality testing in short panels: the case of infrastructure provision and population growth in the Brazilian Amazon. Journal of Regional Science, 41 (4). pp. 639-657. ISSN 0022-4146

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Abstract

In this paper we examine the relationship between infrastructure growth and population growth in the Amazon using a panel of 293 municipalities over the period from 1975 to 1985. Contemporaneous cross-section analysis confirms a strong positive correlation between infrastructure and urban population but does not indicate direction of causality. Thus, we employ a modified form of the traditional Granger causality tests to suit the short time series that we have available. Based on out-of-sample forecasting tests we conclude that the empirical evidence supports the hypothesis that growing urban populations lead to more infrastructure development, rather than vice versa.

Item Type: Article
Official URL: http://www.blackwellpublishing.com/journal.asp?ref...
Additional Information: © 2001 Blackwell Publishing
Library of Congress subject classification: H Social Sciences > H Social Sciences (General)
Sets: Departments > International Development
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 19 Nov 2008 10:06
URL: http://eprints.lse.ac.uk/18423/

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