Pop-Silaghi, Monica Ioana (2006): Testing Trade-led-Growth Hypothesis for Romania.
Download (407kB) | Preview
This paper tests the relationship between trade and economic growth for the case of Romania, during 1998-2004. We employed cointegration and Granger-causality tests on stochastic systems composed of exports, imports and GDP. In order to have some degree of significance, we performed our tests on quarterly data. We found that exports do not Granger-cause GDP in the Romania’s case, while the inverse relationship holds. The presence of imports in the stochastic models does not affect significantly the results. For validating our results, we performed the same tests on the 10 countries that entered EU on 1 May 2005, Bulgaria and EU with 15 members and EU with 25 members. We found that only in few cases – Czech Republic, EU 15 and Bulgaria, export-led-growth hypothesis is verified. Bi-directional causality found for exports and output in the case of Czech Republic and EU 15 is implying a virtuous circle of growth and exports, case that should be desirable for all the countries from the sample. The analyzed countries have situations which differ from case to case and a unified framework can not be applying for a generalization of the results.
|Item Type:||MPRA Paper|
|Original Title:||Testing Trade-led-Growth Hypothesis for Romania|
|Keywords:||growth; trade; causality; cointegration; time series|
|Subjects:||C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models
O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O57 - Comparative Studies of Countries
F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F43 - Economic Growth of Open Economies
|Depositing User:||Monica Ioana Pop-Silaghi|
|Date Deposited:||04. Jan 2007|
|Last Modified:||09. Mar 2015 11:59|
1. Andrei, Tudorel, Statistics and Econometrics, Ed. Economică, Bucureşti, 2003 (in Romanian) 2. Axfentiou, P. C.; Serletis, A., Exports and GNP causality in the industrial countries 1950-1985, Kyklos 44, 1991, p. 167-179 3. Balassa, Bela, Exports, Policy Choices and Economic Growth in Developing Countries after the 1973 Oil Schock, Journal of Development Economics, 18: 23-35,1985 4. Box, G., Jenkings, G. Reinsel G., Time Series Analysis-Forecasting and Control, Prentice Hall, 1994 5. Bresson, G., Pirotte, A., Econometries des series temporelles, PUF, Paris, 1995 6. Dickey, D.A., Fuller, W.A. Distributions of the estimators for autoregressive time series with a unit root. Journal of the American Statistical Association 74, 427-81, 1979. 7. Dominiguez, Loreto, Economic Growth and Import Requirements, Journal of Development Studies, 6(3), p.283-299, 1970 8. Engle, R.F., Granger, C.W.J. Cointegration and error correction: representation, estimation and testing. Econometrica 55, 251-76, 1987. 9. Feder, Gerhson, On Exports and Economic Growth, Journal of Development Economics, 12, p.59-73, 1983 10. Florea, I., (coord.). I Parpucea, A. Buiga, D. Lazăr, Inteferential Statistics, Presa Universitară Clujeană, 2000 (in Romanian) 11. Giles, J.A., Williams C.L., Export-Led Growth: A Survey of the Empirical Literature and Some Noncausality Results, Part 1, Journal of International Trade and Economic Development, 2000, 9, p. 261-337 12. Grossman, G.E., Helpman , Innovation and Growth in the Global Economy, Cambridge Mass.: MIT Press, 1991 13. Johansen, S. Statistical analysis of cointegration vectors. Journal of Economic Dynamics and Control 12, 231-54, 1988. 14. Jung, W. S., Marshall, P. J., Exports, Growth and Causality in Developing Countrie, Journal of Development Economics, February 1985, 1-12. 15. Kavoussi, R. M, International Trade and Economic Development: the Recent Experience of Developing Countries, in Journal of Developing Areas, no.19, pp.379-392, 1985 16. Krugman, Paul; Helpman,E., Imperfect Competition and International Trade: Evidence from fourteen Industrial Countries, Cambridge: Harvard University Press, p.28, 1988 17. Larre, B., Torres, R., La convergence est-elle spontanee? Experience comparee de l’Espagne, du Portugal et de la Greece, Revue Economique de l’OCDE, no.16, Printemps, p.193-223,1991 18. Marin, D., Is the Export-led Hypothesis Valid for Industrialized Countries?, Review of Economics and Statistics, 74, 1992, p.678-688 19. Michaely , Michael, Exports and Growth: an empirical investigation, Journal of Development Economics, 4, p.49-53, 1977 20. Perreira, A., Importacao de bens de capital e evolucao economica interna: os casos da Grecia e de Portugal, Banco de Portugal, Boletim Economico, December, p. 59-66, 1996 21. Pop-Silaghi, Monica, Measuring trade performance of Romania, in Proceedings of the conference: “The Impact of European Integration on the National Economy”, 28-29 October, Faculty of Economics, Babes-Bolyai University, Cluj-Napoca, 2005 22. Tyler, William, Growth and Export Expansion in Developing Countries, Journal of Development Economics, 9, 121-130, 1981