Topics in Middle Eastern and North African Economies

Document Type

Article

Publication Date

5-1-2020

Abstract

This paper investigates the regime changes in the Lebanese economy using Markov Switching Auto Regressive models. Using the industrial production index and various variables, including oil prices, we identify two distinct regimes. The findings reveal that the Lebanese growth cycles are largely driven by seasonal effects and random shocks. The findings also indicate that the average duration of the instable and slow growth regime is much longer than that of the expansion and high growth regime. Finally, the probabilities of switching from one regime to another are rather very low but nearly zero for switching from the instable slow growth regime to the expansion and high growth regime. Hence, the estimated transition probabilities indicate the danger of the slowdown growth regime becoming permanent in Lebanon.

Journal Title

Topics in Middle Eastern and North African Economies

ISSN

2334-282X

Publisher

Middle East Economic Association and Loyola University Chicago

Volume

22

Issue

1

Comments

Presentation of the articles in the Topics in Middle Eastern and North African Economies was made possible by a limited license granted to Loyola University Chicago and Middle East Economics Association from the authors who have retained all copyrights in the articles.

Creative Commons License

Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Download

Included in

Economics Commons

Share

COinS