Topics In Macroeconomics With Time Series Econometrics
Main Topic (Global food prices, the average price of food commodities across countries, play an important role worldwide, strongly influencing food affordability and diet.
They also affect the incomes of farmers and producers, particularly in low income countries where a large fraction of the population is employed in the agricultural sector.
You are asked to investigate the relationship between the global price of corn and the global price of soybeans, two major agricultural commodities. Their price is quoted in US dollars per Metric Ton.
The file commodity.xls contains the dataset1 which is quarterly and runs from 1990Q1 to 2021Q3.)
Task:
Are the two variables co integrated?
Informal check: Data plot, residual plot
Formal tests: Engle Granger Test
Explain the Data Correlation using the code and formulas relevant with Engle Granger Test
