The purpose of this study is to estimate and forecast the marine trading volumes based on the structural model. We employ Engle and Granger two-step cointegration technique. Johansen`s multivariate cointegration methodology and GPH test, since the mod...
The purpose of this study is to estimate and forecast the marine trading volumes based on the structural model. We employ Engle and Granger two-step cointegration technique. Johansen`s multivariate cointegration methodology and GPH test, since the model must be stationary to get the accurate predicted values. The empirical results show that out model is stationary as well as mean-reverting. This paper also applies variance decompositions and impulse-response functions to the structural model composed of the real effective exchange rate, domestic industrial activity, and world business. The results indicate that while both loading and unloading volumes respond positively to the shocks in income and then decay very slowly, their responses are different to the shocks in exchange rate. This study also compares the forecasting accuracy of the structural model with that of the nonstructural model, ARIMA model, showing that the former outperforms the latter.