This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. Empirical evidence on the relationship between trade liberalization, exchange rates, and tax revenue is mixed. This paper examines these linkages anew. Using a panel of 22 countries in Sub-Saharan Africa, over 1980-1996, we perform Generalized Method of Moment regressions to test this relationship. We find evidence that the relationship between trade liberalization and tax revenue is sensitive to the measure used to proxy trade liberalization, but that, in general, trade liberalization is not strongly linked to aggregate tax revenue or its components-though with one measure, it is linked to higher income tax revenue. Currency appreciation and higher inflation show some linkage to lower tax revenues or its components. These results show some partial consistency with previous findings, and support the notion that trade liberalization accompanied by appropriate macroeconomic policies can be undertaken in a way that preserves overall revenue yield.

This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. Empirical evidence on the relationship between trade liberalization, exchange rates, and tax revenue is mixed. This paper examines these linkages anew. Using a panel of 22 countries in Sub-Saharan Africa, over 1980-1996, we perform Generalized Method of Moment regressions to test this relationship. We find evidence that the relationship between trade liberalization and tax revenue is sensitive to the measure used to proxy trade liberalization, but that, in general, trade liberalization is not strongly linked to aggregate tax revenue or its components-though with one measure, it is linked to higher income tax revenue. Currency appreciation and higher inflation show some linkage to lower tax revenues or its components. These results show some partial consistency with previous findings, and support the notion that trade liberalization accompanied by appropriate macroeconomic policies can be undertaken in a way that preserves overall revenue yield.

We examined the return–volatility relationship for USO ETF oil price return and CBOE Crude Oil ETF Volatility Index, OVX. The data for the USO and OVX covers the period covering May 11, 2007 to February 28, 2013. Our OLS regression results suggest evidence of regular feedback and leverage effects. When we employ linear quantile regression techniques, we find evidence of regular and inverse feedback effects. The inverse feedback effects being noticeable in the upper quantile region of the oil return distribution. There is also support for a regular leverage effect in USO prices. We also examined the return–volatility relationship using quantile regression copula methods for measuring the degree of asymmetry in the relationships between the oil price return and implied volatility. The results of the analysis indicate, first, that there exists a negative relationship between contemporaneous oil VIX and USO ETF oil returns. Second, that the relationship between oil returns and implied volatilities depends on the quartile at which the relationship is being investigated. Third, there exists an inverted U‐shaped dependency relationship between returns and implied volatilities across quantiles. Fourth, though an inverted U‐shape exists, the shape is different from those observed in stock markets.