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An empirical analysis of the export-led growth (ELG) hypothesis in the Philippines

Author

Listed:
  • Richard Ballester

    (National Economic and Development Authority)

  • Joy Sinay

    (National Economic and Development Authority)

Abstract

We reexamine the relationship between growth and exports of the Philippines for the period 1977Ð2009 using the methods of Sharma and Panagiotidis [2005] and Feder [1983]. With the shift in the current economic policy toward inclusive growth, we find it necessary to assess if indeed the export-led growth (ELG) hypothesis really worked for the country. Specifically, our research investigates the cointegration of exports, imports, and output using the Johansen cointegration test and the Breitung cointegration test; the Granger-causality between exports, investments, and output; and the impact of macroeconomic shocks by employing a vector autoregressive model. In summary, we find that the ELG hypothesis appears to be empirically unsupported for the Philippine case. Classification-E20, F10, F41, O11, O24

Suggested Citation

  • Richard Ballester & Joy Sinay, 2013. "An empirical analysis of the export-led growth (ELG) hypothesis in the Philippines," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 50(1), pages 83-110, June.
    • Handle: RePEc:phs:prejrn:v:50:y:2013:i:1:p:83-110
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    File URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/892/792
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    References listed on IDEAS

    as
    1. Riezman, Raymond G & Whiteman, Charles H & Summers, Peter M, 1996. "The Engine of Growth or Its Handmaiden? A Time-Series Assessment of Export-Led Growth," Empirical Economics, Springer, vol. 21(1), pages 77-110.
    2. Furuoka, Fumitaka, 2009. "Econometric Analysis of the Export-led Growth Hypothesis: Evidence for BIMP-EAGA Countries," Philippine Journal of Development PJD 2007 Vol. XXXIV No. 2, Philippine Institute for Development Studies.
    3. Abhijit Sharma & Theodore Panagiotidis, 2005. "An Analysis of Exports and Growth in India: Cointegration and Causality Evidence (1971–2001)," Review of Development Economics, Wiley Blackwell, vol. 9(2), pages 232-248, May.
    4. Lorna E. Amrinto & Hector O. Zapata, 2006. "A semiparametric assessment of export-led growth in the Philippines," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 43(2), pages 1-22, December.
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