The objective of this paper is to examine the Wagner's law validity, and whether it can explain the U.K. public spending expansion for the period 1850-2010. According to Wagner's Law, economic development is the key determinant to public sector growth. Accordingly, the public sector grows overproportionally compared to national income when economies develop. We test this hypothesis for the UK. The data covers a period in which the U.K. economy experienced increased economic growth, government spending and met most of the assumption of Wagner's Law (industrialisation, urbanisation, increased population). Furthermore, the long data set ensures the reliability of our results in terms of statistical and economic conclusions. We apply unit root tests, unit root tests with structural breaks, cointegration techniques and the Granger causality test. Our results indicate a presence of a long run relationship between national income and government spending, while the causality is bi-directional, thus we find support for Wagner's and Keynesian hypotheses.

This study analysed the dynamics of the international soybean market using econometric techniques and economic models to study the impacts of the US–China trade war. It considered the analysis of “spatial” (horizontal) price transmission during an approximately ten-year period from September 2009 to May 2019 using monthly time-series data. The research focused on the leaders in the international soybean market, namely, China, the USA, the EU, Brazil and Argentina. Several econometric techniques were employed. The stationarity of the price time series was determined using the augmented Dickey–Fuller (ADF) unit root test. Structural breaks were inferred using the ADF test with a breaks test and a Bai–Perron multiple break test. The long-term relation/cointegration amongst the series was determined using the Johansen cointegration test (1988), with the previous breaks input as dummy variables. The direction of the causality was inferred using the Granger causality test (1969). The long-term and short-term causal relations were determined using the vector autoregression model (VAR) and the vector error correction model (VECM). The results showed a highly efficient and cointegrated market. The incidents of the trade war, as represented by tariffs and subsidies, had minor effects on the market efficacy, cointegration and price transmission. The arbitrage process of the studied market managed to get around the tariffs. In other words, there was no empirical evidence to support the claim that the law of one price (LOOP) did not hold.

Albania has experienced a rapid transition from a centrally planned economy to a mixed economy since the fall of communism in 1989. Policy changes, trade liberalization, and privatization have come about at a rapid pace, allowing foreign direct investment (FDI) and international trade to become key components of Albania’s economy. Against this backdrop, this study investigates the relationships among FDI, trade, and economic growth in Albania. Annual time-series data were obtained from the World Bank. Then, the following econometric tests were performed on the variables representing FDI inflows, exports, and GDP as proxies for FDI, trade, and economic growth: the unit root test; the unit root test with a structural break; Johansen cointegration analysis; the error correction model; and the Granger causality test. The results revealed a long-term relationship between FDI, trade, and economic growth. The Granger causality tests found unidirectional causality. Economic growth brought about exports and FDI in the short term but not vice versa. In conclusion, policymakers need to design policies that promote technology-based, export-promoting FDI to meet the needs of the economy and develop specialized sectors that are competitive in the global market. Furthermore, the salient takeaway is that the penetration of export markets should be promoted as much as the furtherance of FDI.

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