Peter J. Saunders

Causality of U.S. Agricultural Prices and the Money Supply: Further Empirical Evidence

Empirical evidence presented in this study indicates that the results of causality tests of U.S. agricultural prices and the money supply are sensitive to the lag selection. Relying on the minimum final prediction error causality testing technique, a unidirectional causal flow is established from the monetary base to retail level agricultural prices. No such flow is found to exist from M2 to retail agricultural prices. When farm-level agricultural prices are investigated, no causal flow exists from any of the measures of the money supply to farm prices.

Impact of Globalization on Income Distribution Inequality in 60 Countries

This paper investigates the impact of globalization on income inequality distribution in 60 developed, transitional, and developing countries. Using Kearneys (2002, 2003 and 2004) data and principal component analysis (PCA), two globalization indices are created. One of these indices is the equally weighted index. The other index is derived from the principal component analysis. The Gini coefficient of a country is regressed on each index, respectively, in all 60 test cases.The main contribution of this paper is its finding of a negative relationship between both globalization indices and the Gini coefficient for all 60 countries under investigation. Furthermore, test results indicate that this relationship is robust. Therefore, the empirical evidence presented in this paper supports the claim that globalization helps reduce income distribution inequality within countries.

Trade and wage inequality: Are they related?

The objective of this paper is to investigate the relationship between net exports and wage inequality in the U.S. The short- and long-run analyses of the U.S. trade and wage data are undertaken. Cointegration test results indicate that net exports and wage inequality are related in the long run. The main contribution of this paper lies in its focus on the short-run investigation of the relationship between net exports and wage inequality. This investigation was conducted using the vector error correction (VEC) testing framework. Contrary to the prevailing view, the VEC test results indicate that trade has no statistically significant impact on wage inequality in the U.S. Instead, the empirical evidence shows a negative causal impact of wage inequality on net exports.