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Empirical Economics

, Volume 57, Issue 5, pp 1829–1852 | Cite as

Backcasting cement production and characterizing cement’s economic cycles for Chile 1991–2015

  • Byron J. Idrovo-Aguirre
  • Javier E. Contreras-ReyesEmail author
Article
  • 116 Downloads

Abstract

Cement is a non-storable input in the medium and long term. The evidence in Chile shows that cement supply and demand are in relative equilibrium, so the demand or supply of this input can measure the activity in the structural construction or work. The aim of this paper is to backcast the series of cement production since January 2009, using as an instrument the connection of the series of cement sales, available on a monthly basis from 1991–2015. To this end, we apply the Johansen cointegration method. Then, a model of state space is proposed to characterize the cycle of cement production, taking its connection with investment in construction into account. Indeed, cement production, technically, is a leading indicator of sectoral investment.

Keywords

Cement Construction investment Retropolation Cointegration State space Chile 

JEL Classification

C1 E2 L6 O4 

Notes

Acknowledgements

The authors acknowledge the valuable comments of the Economic Research team of the Cámara Chilena de la Construcción (CChC). Marcela Ruiz-Tagle provided especially illuminating and important comments. We also thank the Instituto Nacional de Estadística (INE, Santiago, Chile) to permit us access to the cement as analytical indicator database. The support Harry Estay in the drafting of a cooperation agreement between INE-CChC is especially appreciated. We would like to thank the editor and two anonymous referees for their helpful comments, suggestions and valuable discussion for this work.

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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  • Byron J. Idrovo-Aguirre
    • 1
  • Javier E. Contreras-Reyes
    • 2
    Email author
  1. 1.Gerencia de Estudios EconómicosCámara Chilena de la ConstrucciónSantiagoChile
  2. 2.Instituto de EstadísticaUniversidad de ValparaísoValparaisoChile

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