Research Article
Role of Money in Smaller Pacific Island Countries
Table 7
Granger causality test for output and prices in four PICs.
| Country | -statistics | ECT ( statistics) | LM2 | LIR | LER |
| Effects on output | | | | | Samoa | 17.583*** | 14.189*** | 4.228* | −0.6458** (−2.697) | Solomon Islands | 7.671*** | 1.759 | 3.492* | −0.3801*** (−3.056) | Tonga | 7.097*** | 1.342 | 5.081** | −0.4181*** (−3.306) | Vanuatu | 8.732*** | 0.148 | 3.768* | −0.3495** (−2.540) | Effects on prices | | | | | Samoa | 5.079*** | 0.371 | 3.767** | −0.5965** (−2.249) | Solomon Islands | 8.131*** | 4.876** | 11.947*** | −0.3159** (−2.757) | Tonga | 16.609*** | 14.007*** | 5.984** | −0.9035*** (−4.176) | Vanuatu | 4.093** | 0.633 | 3.816* | −0.6684*** (−5.743) |
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Notes: *, **, and ***indicate significance at 10%, 5%, and 1% levels, respectively. Figures in parentheses representing statistics.
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