Volume 71, Issue 2

Our paper inspects empirically the asymmetric impact of daily oil price shocks on the quarterly real domestic product in eight countries during the period (1983–2016). We employ two methodologies Ordinary Least Squares (OLS) and Asymmetric Mixed Data Sampling (AMIDAS). The OLS technique shows that the positive oil price shocks have a statistically significant negative effect on economic growth in all the countries and vice versa. In addition, it reveals that this relationship could be either symmetric or asymmetric in all the countries. On the contrary, the AMIDAS gives more important details and proves that all the relationships in our sample data are asymmetric. Thus, we think that the AMIDAS technique leads to more accurate results which enhances a better insightful of an energy policy. The policy implication of our paper demonstrates that the energy policies are significant procedures to improve economic performance.

At the forefront of macroeconomic research on the causes of the Great Financial Crisis (GFC) was and still is the usage of dynamic stochastic general equilibrium (DSGE) models. To capture the nonlinearities of the GFC, these models were enriched with a variety of financial frictions. This paper focuses on a special subset of these frictions, the shadow banking system. We provide a structured review of the strand of literature that considers shadow banking in DSGE setups and draw particular attention to the modeling approach as well as impact of shadow banking. Our analysis allows the following conclusions: firstly, models featuring shadow banking are better able to simulate realistic movements in the business cycle that are of comparable magnitude to the GFC. Secondly, the models consider amplification channels between the financial sector and the real economy that proved to be of importance during the crisis. Thirdly, the models display a good explanatory power of financial stability measures in the light of shadow banking.

Despite a sizeable theoretical and empirical literature, no firm conclusions have been drawn regarding the democracy–economy-nexus. This paper aims to assess the twosided relationship between democracy and economic development based on the current state of research. Literature will be used to examine whether and how democracy affects economic development, as well as the reverse question. Does economic development influence the form of government of a society, i.e. can it promote or hinder a transition from autocracy to democracy? In addition to approaches that postulate a positive relationship, we will also present perspectives that either negatively interpret a correlation between the two variables or completely negate it.