ABSTRACT
This chapter investigates the importance of the role of exports by examining the joint postwar economic experience across a variety of panel time series datasets, including a panel for the Four Asian Tigers, and a case study for South Korea. The theoretical motivation for the empirical work conducted in the paper is based on the model presented in the seminal work of Blanchard and Quah (1989), in which the authors examined the effects of aggregate demand and supply shocks in the US economy during the postwar era. The chapter explores Granger causality tests, which may give information on potential additional identifying restrictions based on the short-run direction of causation. Of course, it may be that the identifying restrictions used in the chapter do not accurately separate demand shocks into nominal domestic demand shocks and export shocks, and part of the nominal demand shock impact could actually contain export shocks.
