Does Black's output variability hypothesis hold for Mexico?

Joseph Macri, Dipendra Sinha

Research output: Contribution to journalArticle


We study, using two data series, namely GDP and the index of industrial production, the relationship between output variability and the growth rate of output for Mexico. Ng-Perron unit root test shows that the growth rate of GDP is non-stationary but the growth rate of industrial output is stationary. Therefore, we use the ARCH-M model for the monthly data of industrial output. A number of specifications (with and without a dummy variable) are used. In all cases, the results show that output variability for Mexico has a negative but insignificant effect on the growth rate of output.
Original languageEnglish
Pages (from-to)1105-1111
Number of pages7
JournalThe Empirical economics letters
Issue number11
Publication statusPublished - 2009


  • economic growth
  • volatility
  • variability
  • business cycle fluctuations
  • ARCH models

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