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Urban population and economic growth: South Asia perspective

Author

Listed:
  • Sandip Sarker
  • Arifuzzaman Khan
  • Mehdad Mamur Mannan

Abstract

Previously economic growth was generally discussed in terms of foreign direct investment (FDI), educational growth, savings, investments, inflation as well as trade openness of a nation. Very recently it has been identified that population is one of the major determinants of economic growth of a nation. In the recent years, the study of urbanization has gained a matter of concern in developing countries as it has been recognized as part of a larger process of economic development which is affecting developing countries. South Asian countries are one of the emerging economics and growing at a faster rate over the past few years. At the same time, population of South Asia is growing at a significant rate. Therefore the study has attempted to identify the causal relationship between urban population and economic growth in South Asia using a panel data analysis. The study makes use of the Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP), Pesaran as well as Fisher methods for panel unit root test. The panel Pedroni cointegration test suggests that there is long run relationship between the variables. The further panel Vector Error Correction Model (VECM) suggests that there is long run causality running from urban population growth to economic growth in South Asia. The study concludes that the growth of urban population can have significant impact on economic growth in South Asia in the long run.

Suggested Citation

  • Sandip Sarker & Arifuzzaman Khan & Mehdad Mamur Mannan, 2016. "Urban population and economic growth: South Asia perspective," European Journal of Government and Economics, Europa Grande, vol. 5(1), pages 64-75, June.
    • Handle: RePEc:egr:ejge00:v:5:i:1:p:64-75
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    References listed on IDEAS

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    Cited by:

    1. Anowara Khanam & Md. Shariful Islam, 2019. "Urbanization and Income inBangladesh: An Empirical Analysis," Journal of Business, LAR Center Press, vol. 4(2), pages 19-27, February.

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    More about this item

    Keywords

    Urban Population; Economic Growth; South Asia; Vector Error Correction Model; Panel Data;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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