Akmal, Muhammad Shahbaz and Ahmad, Khalil and Ali, Muhammad (2009): Exports-Led Growth Hypothesis in Pakistan: Further Evidence. Forthcoming in:
Download (178kB) | Preview
This paper examines the exports-led growth hypothesis using quarterly data from 1990 up to 2008 for Pakistan. In doing so, ARDL bounds testing approach, Error Correction Method (ECM) and Ng-Perron test for integration have been employed. The empirical findings show that exports are positively correlated with economic growth. This confirms the validity of exports-led growth hypothesis in the case of Pakistan both for short run and long span of time. Exchange rate depreciation declines economic growth while running real capital stock improves it.
|Item Type:||MPRA Paper|
|Original Title:||Exports-Led Growth Hypothesis in Pakistan: Further Evidence|
|English Title:||Exports-Led Growth Hypothesis in Pakistan: Further Evidence|
|Keywords:||Exports, Economic Growth, ARDL Approach|
|Subjects:||F - International Economics > F1 - Trade > F10 - General
C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C22 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes
E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E10 - General
|Depositing User:||Khalil Ahmad|
|Date Deposited:||14. Jan 2011 09:23|
|Last Modified:||11. Feb 2013 10:43|
• Abdulai. A and Jaquet. P, (2002), “Exports and Economic Growth: Cointegration and Causality Evidence for Cote d’Ivoire” African Development Review, pp: 1-14. • Abual-Foul, B. (2004), “Testing the Export-Led Growth Hypothesis: Evidence from Jordan”, Applied Economics Letters, pp: 393-396. • Agbola, (2007), “Testing for Export-Led Growth Hypothesis in the Philippines using a Multivariate VAR Framework” mimeo. • Alsuwaidi and Shamsi, (1997), “Exports and Economic Growth in Egypt: Evidence from Cointegration Analysis” Journal of King Saud University, pp”99-106. • Al-Yousif, Y. K. (1999). On the Role of Exports in the Economic Growth of Malaysia: A multivariate analysis. International Economic Journal, pp: 67–75. • Amrinto. L. (2006), “A Semi Parametric Assessment of Export-Led Growth in The Philippines” Master Dissertation, The Department of Agricultural Economics and Agribusiness, Louisiana State University. • Anwar, Muhammad S. and R. K. Sampath, (2000), “Exports and Economic Growth.” Indian Economic Journal, pp: 79-88. • Awokuse, T. O. (2005a), “Exports, Economic Growth and Causality in Korea”, Applied Economics Letters, pp: 693-696. • Awokuse, T. O. (2005b) Export-Led Growth and the Japanese Economy: Evidence from VAR and Directed Acyclic Draphs, Applied Economics Letters, pp: 849-858. • Bahmani-Oskooee, M. and Alse, J. (1993), “Export Growth and Economic Growth: an Application of Cointegration and Error Correction Modeling”, The Journal of Developing Areas, pp: 535–42. • Bahmani-Oskooee, M. and Domac, I. (1995), “Export Growth and Economic Growth in Turkey: Evidence from Cointegration Analysis”, Middle East Technical University Studies in Development, pp: 67–77. • Bahmani-Oskooee, M., Mohtad, H. and Shabsigh, G. (1991) ‘Exports, growth and causality in LDCs: A Reexamination’. Journal of Development Economics, pp: 405–15. • Balaguer, J. and Cantavella-Jorda, M. (2001), “Examining the Export-led Growth Hypothesis for Spain in the Last Century, Applied Economics Letters, pp: 681-685. • Balassa, B. (1978), “Exports and Economic Growth: Further Evidence’. Journal of Development Economics, pp: 181–9. • Balassa, B. (1984), “Adjustment to External Shocks in Developing Economies”. World Bank Staff Working Paper 472. Washington, DC: The World Bank. • Bannerjee, A., J. Dolado and R. Mestre (1998), “Error-correction Mechanism Tests for Cointegration in Single Equation Framework. Journal of Time Series Analysis, Volume, pp. 267-283. • Begum, S. and Shamsuddin, A. F. M., 1998, “Exports and Economic Growth in Bangladesh.” Journal of Development Studies, Vol. 35, 1 : 89-114. • Bhagwati, J. (1978), “Anatomy and Consequences of Exchange Control Regimes: Liberalisation Attempts and Consequences. Cambridge, MA: Ballinger. Bhat, Sham K. (1995) Export and Economic Growth in India. Artha Vijana 37:4 350–358. • Borensztein, E., De Gregorio, J., J.W. Lee, (1998), “How Does Foreign Investment Affect Growth? Journal of International Economics, p: 115-135. • Bowers, W. and Pierce, G., (1975), “The Illusion of Deterrence in Isaac Ehrlich’s Work on the Deterrent Effect of Capital Punishment”, Yale Law Journal, pp: 187-208. • Chandra, R. (2003), “Reinvestigation Export-Led Growth in India Using a Multivariate Cointegration Framework”, Journal of Developing Areas, pp: 73-86. • Chen, Shyh-Wei, (2007), “Exactly what is the Link between Export and Growth in Taiwan? New Evidence from the Granger Causality Test” Economics Bulletin, pp: 1-10. • Clarke, J and Ralhan, M, (2005), “Direct and Indirect Causality between Exports and Economic Output for Bangladesh and Sri Lanka: Horizon Matters” Econometrics Working Paper EWP05012, Department of Economics, University of Victoria, Victoria, B.C., Canada V8W 2Y2, July, 2005. • Darrat, A. F., Hsu, M. K. and Zhong, M. (2000), “Testing Export Exogeneity in Taiwan: further evidence”, Applied Economics Letters, pp: 563-567. • Dickey, D. A., and W. A. Fuller (1979), “Distribution of the Estimation for Autoregressive Time Series with a Unit Root”, Journal of American Statistical Association, pp: 355–367. • Dodaro, S., 1993, “Exports and Growth: A Reconsideration of Causality”, Journal of Developing Areas, pp: 227-244. • Doyle, E. (1998), “Export-Output Causality: The Irish Case, 1953–1993”, Atlantic Economic Journal, pp.147–162. • Ehrlich, I., (1975), “The Deterrent Effect of Capital Punishment – A Question of Life and Death”, American Economic Review, pp: 397-417. • Ehrlich, I., (1977), “The Deterrent Effect of Capital Punishment Reply”, American Economic Review, pp: 452-58. • Ekanayake, E. M. (1999), “Exports and Economic Growth in Asian Developing Countries: Cointegration and Error-Correction Models”, Journal of Economic Development, pp: 43–56. • Engle, R. F. and Granger, C. W. J. (1987). “Co-integration and Error Correction: Representation, Estimation and Testing”, Econometrica, pp: 251-76. • Federici and Marconi, (2002), “On Exports and Economic Growth: The Case of Italy”, Journal of International Trade & Economic Development, pp: 323-340. • Ferda, (2007), “A Multivariate Causality Analysis of Export and Growth for Turkey”, MPRA Paper-3565. • Fountas, S. (2000), “Some Evidence on the Export-led Growth Hypothesis for Ireland”, Applied Economics Letters, pp: 211-214. • Fuad A-Stait (2005), “Are Exports the Engine of Economics Growth? An Application of Co-integration and Causality Analysis for Egypt”. Economic Research working paper series no 76 (July 2005). • Furuoka, Fumitaka, (2007), “Do Exports Act as “Engine” of Growth? Evidences from Malaysia”. Economic Bulletin, pp. 1-14. • Ghali, H, K. (2000), “Export Growth and Economic Growth: The Tunisian Experience” J. King Saud University Vol. 12, Admin. Sci. pp.127-140. • Ghatak, S., and Price, S. W., (1997), “Export Composition and Economic Growth: Co-Integration and Causality Evidence for India.” Review of World Economics, pp. 538-553. • Granger, C.W.J. (1969), “Investigating Causal Relations by Econometric and Cross- Spectral Method,” Econometrica, pp: 424-438. • Granger, C.W.J. (1988), “Some Recent Developments in a Concept of Causality,” Journal of Econometrics, pp: 199-211. • Hatemi-J, A. and Irandoust, M. (2000), “Export Performance and Economic Growth Causality: An Empirical Analysis, Atlantic Economic Journal, pp: 412-426. • Holman, J.A. and Graves, P.E. (1995), “Korean Exports Economic Growth: An Econometric Reassessment”, Journal of Economic Development, pp: 45–56. • Howard, M. (2002), “Causality between Exports, Imports and Income in Trinida and Tobago”. International Economic Journal pp: 97-106. • Johansen, S. (1988), “Statistical Analysis of Cointegration Vectors”, Journal of Economic Dynamics and Control, pp: 231–54. • Johansen, S. and Juselius, K. (1990), “Maximum Likelihood Estimation and Inference in Cointegration – With Application to the Demand for Money” Oxford Bulletin of Economics and Statistics pp: 169–210. • Jordaan and Eita, (2006), “Export and Economic Growth in Namibia: A Granger Causality Analysis” mimeo. • Jung, W. S. and Marshall, P. J. (1985). “Exports, growth and causality in developing countries”, Journal of Development Economics, pp: 1-12. • Kaldor N (1967), “Strategic Factors in Economic Development”, New York State School of Industrial and Labor Relations, Cornell University, Ithaca, NY. • Karagoz, and Sen (2005), “Exports and Economic Growth of Turkey: Co-integration and Error Correction Analysis”, Elektronik Sosyal Bilimler Dergisi, pp: 1-14. • Kavoussi, R. M. (1984), “Export Expansion and Economic Growth: Further empirical evidence”, Journal of Development Economics, pp: 241-250. • Kemal, A. R., Musleh ud Din, Usman Qadir, Lloyd, F. and Sirimevan, S. Colombage, (2002), “Exports and Economic Growth in South Asia.” A Study Prepared for the South Asia Network of Economic Research Institutions. • Keong, C. Zulkorain, Y and Venus, L. K (2003), “Export-led Growth Hypothesis in Malaysia: An Application of Two- Stage Least Square Technique”, International finance. • Keong, C. Zulkorain, Y and Venus, L. K (2005), “Export-Led Growth Hypothesis in Malaysia: An Investigation Using Bounds Test”. Sunway Academic journal, pp13-22. • Kessing, (1967),”Out-ward Looking Policies and Economic Growth”, Economic journal, pp: 303-320. • Khan, A and Afia, (1995), “Export Growth and Causality: An Application of Co-Integration and ECM Model.” The Pakistan Development Review, pp: 145-161. • Khan, A. H. and N. Saqib, (1993), “Exports and Economic Growth: The Pakistan Experience.” International Economic Journal, pp: 53-64. • Khan, A. H., A. Malik, and L. Hassan, (1995), “Exports, Growth and Causality: An Application of Co-Integration and Error-Correction Modeling.” Paper presented at the Eleventh Annual General Meeting of the Pakistan Society of Development Economists. April 18-21. PIDE, Islamabad. • Kremers, J. J. M., N. E. Ericsson and J. J. Dolado (1992), “The Power of Cointegration Tests. Oxford Bulletin of Economics and Statistics, pp. 325-348. • Krueger, A. O., (1978), “Foreign Trade Regimes and Economic Development: Liberalization Attempts and Consequences”, Cambridge, MA: Ballinger. • Kunst RM, Marin D (1989), “On exports and productivity: A causal analysis. Review of Economics and Statistics, pp: 699–703. • Layson, S., (1983), “Homicide and Deterrence: Another View of the Canadian Time Series Evidence”, Canadian Journal of Economics, pp: 52-73. • Leow, Y G. (2004), “A Reexamination of the Exports in Malaysia’s Economic Growth: After Asian Asian Financial Crisis, 1970-2000”. International journal of Management Sciences. 11 (Spacil Issue), 79-204. • Leybourne, S., Kim, T.-H, Smith, V. and Newbold, P. (2003), “Tests for a Change in Persistence against the null of Difference Stationary”, Econometrics Journal, pp”, 290-310. • Love, J and Chandra, R, (2004), “Testing Export-Led Growth in India, Pakistan and Sri Lanka Using a Multivariate Framework”, Journal of the Manchester School, pp: 483-496. • Love, J. and Chandra, R. (2005), “Testing Export-Led Growth in Bangladesh in a Multivarate VAR Framework”, Journal of Asian Economics, pp: 1155-1168. • Love, J. and Chandra, R. (2005), “Testing export-led growth in South Asia”, Journal of Economic Studies, pp: 132-145. • Love, J. and R. Chandra. 2005. “Testing Export-led Growth in South Asia.”Journal of Economic Studies, pp: 132–145. • Lucas, R.E. (1990), “Why does not capital flow from rich to poor countries”, American Economic Review, 80, 92-6. • Mah, J. S. (2005), “Export, Expansion, Economic Growth and Causality in China”, Applied Economics Letters, pp: 105-107. • Mamum K. A. and H. K. Nath (2005), “Expor-led Growth in Bangladesh: a time series analysis” Applied Economics Letters, 12, 361-364. • Masih, A. M. M., and R. Masih R., (1996), “Energy Consumption, Real Income and Temporal Causality: Results from a Multi-Country Study based on Co-Integration and Error Correction Modeling Techniques.” Energy Economics, pp: 165-183. • Merza, M. (2007), “Oil Exports, Non-Oil Exports and Economic Growth: Time Series Analysis for Kuwait (1970-2004)”, PhD Dissertation, Kansas State University, Manhattan, Kansas. • Michaely, M. (1977). “Exports and Growth: An Empirical Investigation”, Journal of Development Economics, pp: 49-53. • Musleh ud Din, (2004), “Exports, Imports, and Economic Growth in South Asia: Evidence Using a Multivariate Time-Series Framework.” The Pakistan Development Review, pp: 105-124. • Mutairi, Naief (1993), “Exports and Pakistan’s Economic Development.” Pakistan Economic and Social Review, pp: 134-146. • Ngoc, P.M.; N. T. Phuong Anh and P.T. Nga (2003), “Exports and Long-Run Growth in Vietnam, 1976-2001” ASEAN Economic Bulletin, pp: 1-25. • Olorunfemi and Olorunsola (2006), “Time Series of Export and Growth in the Economic Growth in the Ecowas Countries”. The Social Sciences, pp: 344-350. • Ozmen, E. and Furten, G. (1998), “Export Led-growth Hypothesis and The Turkish Data: An Empirical Investigation, METU Studies in Development, pp: 491-503. • Pahlavani Mosayeb (2005), “The Relationship between Trade and Economic Growth in Iran: An Application of a New Co-integration Technique in the Presence of Structural Breaks”, Economic Working paper Series. • Panas, E. and Vamvoukas, G. (2002), “Further Evidence on the Export-led Growth Hypothesis,” Applied Economic Letters, pp: 731–745. • Paresh Kumar Narayan and Seema Narayan, (2007), “Is Devaluation Expansionary or Contractionary? Empirical Evidence from Fiji?”, Applied Economics, pp: 2589-98. • Perron, P. (1989), “The Great Crash, the Oil Price Shock and the Unit Root Hypothesis”, Econometrica, pp: 1361-1401. • Perron, P. (1990), “Testing for a Unit Root in Time Series with a Changing Mean”, Journal of Business and Economic Statistics, pp: 153-162. • Pesaran, M. H., Pesaran, B. (1997), “Working with Microfit 4.0: Interactive Econometric Analysis”, Oxford: Oxford University Press. • Pesaran, M. H., Shin, Y. and Smith, R. J. (2001), “Bounds Testing Approaches to the Analysis of Level Relationships”, Journal of Applied Econometrics, pp: 289–326. • Phillips, P.C.B, and P. Perron (1988) “Testing for a Unit Root in Time Series Regressions” Biometrika, pp: 335-346. • Phillips, P.C.B., (1987), “Time Series Regression with a Unit Root” Econometrica 55, 277-301. • Phillips, P.C.B., and S.N. Durlauf (1986), “Multiple Time Series Regressions with Integrated Processes” Review of Economic Studies, pp: 473-495. • Quddus, Muhammad A. and Ikram Saeed, (2005), “An Analysis of Export and Growth in Pakistan.” The Pakistan Development Review, pp : 921-937. • Ramesh and Boaz, (2007),” Testing Export-led Growth Hypothesis in Kenya: An ADRL Bounds Test Approach”, MPRA paper no.5582. • Ramos, (2001), “Exports, Imports and Economic Growth in Portugal: Evidence from Causality and Cointegration Analysis” Economic Modeling, pp: 613-23. • Richard, D.G. (2001), “Exports as a Determinant of Long-Run Growth in Paraguay: 1966-1996” Journal of Development Studies, pp: 128-146. • Riezman, R. & Whiteman, C. & Summers, P.M., (1995), “The Engine of Growth or Its Handmaiden? A Time Series Assessment of Export-Led Growth”, Working Papers 95-16, University of Iowa, Department of Economics. • Sengupta, J.K. and Espana, J.R., (1994), “Exports and Economic growth in Asian NICs: an Econometric analysis for Korea”, Applied Economics, pp: 45-51. • Shan, J. and Sun F., (1998), “On the Export-Led Growth Hypothesis: The Econometric Evidence from China.” Applied Economics, pp: 1055-65. • Sharma, A. and T. Panagiotidis (2005), “An Analysis of Exports and Growth in India: Co integration and Causality Evidence (1971-2001)” Review of Development Economics, pp: 232-248. • Sharma, U. C. and D. Dhakal., (1994), “Causal Analysis between Exports and Economic Growth in Developing Countries.” Applied Economics, pp: 1145-1157. • Shirazi, Nasim Shah and Manap, Turkhan Ali Abdul, (2004), “Export-Led Growth Hypothesis: Further Econometric Evidence from South Asia.” The Developing Economies, pp: 472-488. • Siddiqui. S, Zehra. S, Majeed. S, Butt. M. S, (2008), “Export-Led Growth Hypothesis in Pakistan: A Reinvestigation Using the Bounds Test” Lahore Journal of Economics, pp: 59-80. • Siliverstovs, B. and Herzer, D. (2006), “Export-led Growth Hypothesis: Evidence for Chile”, Applied Economics Letters, pp: 319-324. • Silivertovs, B. (2005), “Export-led Growth Hypothesis Evidence for Chile. Ibero- America Instituet for Economic Research (IAI). http://www.iau.wiwi.uni-goettingen.de. • Sprout, R.V.A., and J.H. Weaver (1993), “Exports and Economic Growth in a Simultaneous Equations Model,” Journal of Developing Areas, pp: 289-306. • Taban, S and Akhtar, I, (2008), “An Empirical Examination of the Export Led-Growth Hypotheses in Turkey”, Journal of Yasar University, pp: 549-564. • Thungsuwan and Thompson, (2006), “Exports and Economic Growth in Thialand: An Empirical Analysis” BU Academic Review, pp: 10-20. • Thungsuwan, S. and Thompasn (2003), “Exports and Economic Growth in Thailand: An Empirical Analysis” BU Academic Review. Pp: 10-20. • Ukpolo, V. (1994), “Export Composition and Growth of Selected Low-Income African Countries: Evidence from Time-Series Data,” Applied Economics, pp: 445-449. • Ahmad. A, Chaudhary. M and Khan, (2005), “The Growth Impact of Exports in South Asian Countries”, The Pakistan Development Review, pp: 901–919.