Firm exports and multinational activity under credit constraints. Economic growth via economic openness occurs through two channels. Therefore, the government involves import trade barriers as tariffs, import quotas, etc. The first two arguments are based on a shortrun macro model of the keyne sian type, which is by its demand orientation not suitable to explain economic growth. The principal reason for a conglomerate merger is utilization of. A conglomerate merger is a merger between two entities in unrelated industries. Pdf the dynamics of relationship between exports and economic. Determinants of export growth at the extensive and intensive. Import substitution industrialisation and economic growth evidence from the group of brics countries aregbeshola r. Evidence from nigeria mukhtar wakil lawan department of economics, modibbo adama university of technology, yola, adamawa state, nigeria abstract the study examines the long run link between export components of oil, nonoil sector and economic growth in. For the causal analysis between exports and economic growth, recent empirical studies have adopted the causality approach suggested by.
Separate consideration is given to manufactured and to total exports. The nexus between exchange rate, exports and economic growth. Relationship between exports, imports, and economic growth in france. In indicating that export grohth favorably alects the rate of economic growth over and above the contrj butions of domestic and foreign capital and labor, the estimates presented in this paper provide evidence on the benefits of export orientation as compared to policies oriented towards import substitution.
Received july 1977, revised version received september 1977 this paper investigates the relationship between exports and economic growth in a group of. Pdf trade, foreign direct investment and economic growth in. Determinants of mergers and acquisitions in the energy industry. This paper reinvestigates empirically the exportled growth elg hypothesis for five countries in the mena region. Exports, domestic demand and economic growth in china. Abstract the nature of the relationship between exports and countrys economic growth has been one of the most debated topic in the recent past, yet with little consensus. The effect of exports and imports on economic growth. Growth, import openness, oecd, endogeneity, instrument, regression. The role of exports in african economic development.
Similar method is further employed by dutt and ghosh 1996 to provide evidence of no causal relationship between the two variables. The contribution of industry and agriculture exports to. The oecd competition committee debated economic evidence in merger analysis in february 2011. Apr 04, 2016 the economic development of developing countries has been associated with their exports, and the evidence suggests that exchange rates influence the exports.
The relationship between export and economic growth in. The main objective of the study was to investigate the relationship between exports, imports and economic growth in kenya. Thus policies geared towards the development of the oil and nonoil sectors will have a positive effect on the economy and thereby resulting to an increase in the gross domestic product. For central and eastern european cee3 countries, there is an obvious lack of studies that examine the effect of exports on economic growth by using the latest time series techniques. The study was guided by the following specific objectives. The successful records of the four dragons or even four tigers have received much attention in the literature on economic growth and have revived the debate on the effectiveness of outward. Peru microeconomic constraints to growth the evidence. In recent years, the trade literature provides a number of empirical evidence to support the. The african case article pdf available in world development 186.
Import substitution policies as the means to stimulate economic growth. The economic development of developing countries has been associated with their exports, and the evidence suggests that exchange rates influence the exports. A company uses this type of merger in order to use the resulting ability to use the same sales and distribution channels to reach the customers of both businesses. Further evidence from asia fayyaz ahmad school of economics lanzhou university, china muhammad umar draz corresponding author department of management and humanities universiti teknologi petronas, malaysia suchang yang school of economics lanzhou university, china abstract. On the other hand, outwardlooking development or export led growth etc strategies involve strategies supporting manufacturing sectors with a. Using the grangercausality approach, we find strong evidence for exportled growth in mauritius, but no significant evidence of any causal relationship in tunisia.
Foreign direct investment, exports and economic growth. Exports and economic growth in south korea and japan ntu irep. Further results show that population density and investment are statistically insignificant. Exports and economic growth further evidence bela balassa johns hopkins university, baltimore, md 21218, u. Subcontractors and service companies to our three sector classifications are also not. Pavel gertler,national bank of slovakia the main message from the classical model of international trade is that growth in trade leads by way of comparative advantages to stronger economic performance in the future. The relationship between export growth and economic growth has been a popular subject of debate among development economists.
The purpose of our paper is to further investigate the quality of exports hypothesis by. The first channel is the classical theory of ricardo, where the two countries through trade and by the law of comparative advantage and specialization, experiencing economic growth. Pdf despite the increasing role of foreign direct investment fdi in economic. Relationship between exports, imports, and economic growth. Ekanayake1 this paper uses cointegration and errorcorrection models to analyze the causal relationship between export growth and economic growth in eight asian developing countries using annual data from 1960 to 1997. Reviewing the literature it seems that over optimism has taken place of pragmatism only based on economic numbers and hence there is a need to highlight the major hurdles in the path of china. Peru microeconomic constraints to growth the evidence from the manufacturing sector june 15, 2004 latin america and the caribbean region poverty reduction and economic management department and financial, private sector and infrastructure department bolivia, ecuador, peru and venezuela country management unit document of the world bank. The relationship among exports, imports and economic growth.
Imported intermediate inputs and domestic product growth. Are exports a reliable source of economic growth in mena. Exports and economic growth in asian developing countries. Export earnings instability and economic growth in nigeria. Information technology it is an example of a general purpose technology that has the potential to play an important role in economic growth, as well as other dimensions of economic and social development. Egypt, jordan, morocco, tunisia, and turkey, using the granger causality technique. This suggests that the interrelationship between foreign direct investment, exports and economic growth has yet to be analyzed in the same framework. Pdf relationship between exports and economic growth of. The relationship between trade openness and economic growthis well debated and well researched topic in thetrade. This paper analyzes the theories behind the role that exports play in growth, and seeks to use regression analysis for four african. However, when he combine this tradedistortion measure with a measure of. Social iqi and political iqi, and then combine them to obtain iqi. The present approach tries to combine both strands of the literature. The nexus between exchange rate, exports and economic.
We used the panel data to investigate potential granger causality among the gdp, exports and exchange rates in asian countries over the period 19702009. The relationship between export and economic growth in libya. For the united states, it was found that economic growth causes export growth, while the opposite is true for taiwan. Further evidence from asia find, read and cite all the research you.
Through the use of descriptive statistics and econometric analysis, this paper assesses the trade competitiveness of pakistan using microdata the case of pakistan is interesting since the countrys recent trade policy has reverted to a protectionist path since the mid2000s and trade performance is stagnating, as indicated by a decrease in its. Relationship between exports, imports, and economic growth in. Further evidence from oecd countries article in applied economics 3516. Annual data for the periods between 1960 and 2015 was tested by practicing johansen cointegration analysis of vector auto regression model and the grangercausality tests. F10,f14,f23,f36,g32 abstract this paper provides firmlevel evidence that credit constraints restrict international trade flows and.
The first channel is the classical theory of ricardo, where the two countries through trade and by the law of comparative advantage and. Empirical investigation of exports and economic growth. This document includes an executive summary of that debate and the documents from the meeting. Gdp in the 1990s in china on the basis of new proposed estimation method, when both. Author links open overlay panel bela balassa show more. F10,f14,f23,f36,g32 abstract this paper provides firmlevel evidence that credit constraints restrict international trade flows and affect the pattern of foreign direct investment. This paper investigates the relationship between exports and economic growth in a group of eleven developing countries that have already established an industrial base.
In indicating that export grohth favorably alects the rate of economic growth over and above the contrj butions of domestic and foreign capital and labor, the estimates presented in this paper provide evidence on the benefits of exportorientation as compared to policies oriented towards import substitution. This study provides the evidence of exportled growth hypothesis. An analysis of the relationship between exports and growth. Import substitution industrialisation and economic growth. Given the above mentioned shortcomings associated with the methodology used in these studies, the observed difference may be attributed to methodological flaws. The purpose of this paper is to examine the role of exportgrowth linkage in india, pakistan, the philippines, malaysia, and thailand on the basis of time series data from 1973 to 1993. Adewale department of business management, college of economic and management sciences, university of south africa, unisa 0003, preller street, muckleneuk ridge, p. Cointegration and causality between exports and economic growth. Cointegration and causality between exports and economic. The focus is on the relationship between exports and economic growth, but the discussion explores the wider context in both countries. Some empirical studies have investigated this interrelationship for asian and nonafrican countries. Request pdf on jan 1, 2016, fayyaz ahmad and others published the nexus between exchange rate, exports and economic growth.
Using the grangercausality approach, we find strong evidence for exportled growth in mauritius, but no significant evidence of. The past, present, and future of economic growth global citizen. To the best of our knowledge, this is the first paper to analyse scale economies in indian bank mergers, which constitutes a premerger analysis and then examine the impact of mergers on shareholders. Evidence from four asian countries, romanian economic journal, department of international business and economics from the academy of economic studies bucharest, vol. An analysis of the relationship between exports and economic growth in 11 developing countries that have already established an industrial base considers manufactured exports and total exports separately, adjusting for domestic and foreign investment. To examine the relationship between exports, imports and economic growth. Most of these arguments are, however, not convincing. A read is counted each time someone views a publication summary such as the title, abstract, and list of authors, clicks on a figure, or views or downloads the fulltext. Goldberg, amit khandelwal, nina pavcnik, and petia topalova nber working paper no. One, referred to as the conventional neoclassical model, assumes that y 0, and thus presents gdp growth as the result of capital and labor growth only. Export earnings, instability and economic growth i. For the causal analysis between exports and economic growth, recent empirical studies have adopted the causality approach suggested by granger 1969 and sims 1972. Recently, dhawan and biswal 1999 examined the relationship between export and the economic growth in india by employing the vector autoregression var model over the period from 1961 to 1993, using the variables of real gdp, real exports and terms of trade in the var model.
It presents an analytical framework that is motivated by the empirical evidence and embeds the. F1,f,f14 abstract new goods play a central role in many trade and growth models. The empirical results indicate that exports have a positive and significant impact on economic growth when a country has achieved some level of economic. Earlier investigations have concentrated on the effect of export expansion on economic growth while ignoring the importance of the stability of such relationship. Central to this debate is the question of whether strong economic performance. The purpose of this paper is to test the probity of the exportled growth elg hypothesis for five emerging economies of asia namely india, indonesia, korea, malaysia, and the philippines. On the other hand, outwardlooking development or export led growth etc strategies. The relationship between exports and growth is an important one in economics, particularly for developing nations that seek to improve the livelihoods of their citizens through economic reform. This paper studies the nexus between exports, imports, and economic growth in turkey. This will be determined by establishing whether a correlation of any nature exists and to examine the strength of the relationship, if any. The existing studies on this issue are focused only on one up to. We do not take into account alternative energy since the sector, though high growth in recent years yet has an insignificant share of the electricity production eurostat, 2008. The purpose of this paper is to examine the role of export growth linkage in india, pakistan, the philippines, malaysia, and thailand on the basis of time series data from 1973 to 1993.
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