Export-Led Growth Hypothesis In The Mena Region: A Multivariate Cointegration, Causality And Stability Analysis
AbstractEmpirical evidence supporting the export-led growth (ELG) hypothesis has been mixed and inconclusive. Some studies may have been misspecified since they tested the ELG hypothesis using bivariate models. Others used multivariate cointegration framework but presumed (either explicitly or implicitly) stability of the cointegrating relations. This study examines the ELG hypothesis for eight Middle East and North Africa (MENA) countries in a multivariate framework by including terms of trade as a third variable. We utilize Johansen and Juselius cointegration procedure and error correction modeling to test the ELG hypothesis. The empirical evidence supports the existence of a “stable” long-run equilibrium relationship among real output, real exports, terms of trade, and finds strong support for the ELG hypothesis in all but one of the MENA countries analyzed.
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Bibliographic InfoArticle provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.
Volume (Year): 10 (2010)
Issue (Month): 2 ()
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Find related papers by JEL classification:
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
- O53 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
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