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Exports, Imports, and Economic Growth in South Asia: Evidence Using a Multivariate Time-series Framework

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  • Musleh-Ud Din

    (Pakistan Institute of Development Economics, Islamabad.)

Abstract

This paper examines the export-led growth hypothesis for the five largest economies of the South Asian region using a multivariate time-series framework. The South Asian countries present an interesting case study in view of their increasing outward orientation and adoption of export promotion policies as part of their growth strategies. A key feature of the study is the explicit incorporation of imports in the analysis to make allowance for their role in the export-economic growth relationship. While controlling for imports, the results indicate bi-directional causality between exports and output growth in Bangladesh, India, and Sri Lanka in the short-run. The study finds long-run equilibrium relationships among exports, imports, and output for Bangladesh and Pakistan. However, for India, Nepal, and Sri Lanka, no evidence of a long-run relationship among the relevant variables is found. These results are in contrast to some earlier work that found the export-led growth hypothesis to be a long-run phenomenon for all countries in the region

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Bibliographic Info

Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

Volume (Year): 43 (2004)
Issue (Month): 2 ()
Pages: 105-124

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Handle: RePEc:pid:journl:v:43:y:2004:i:2:p:105-124

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Keywords: Exports; Imports; Economic Growth; South Asia;

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References

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  1. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
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Cited by:
  1. Muhammad, Shahbaz, 2012. "Does Trade Openness Affect Long Run Growth? Cointegration, Causality and Forecast Error Variance Decomposition Tests for Pakistan," MPRA Paper 37391, University Library of Munich, Germany, revised 10 Mar 2012.
  2. Tronzano, Marco, 2010. "Reassessing the Dynamic Links between Trade and Growth: New Empirical Evidence from India - Un riesame delle relazioni tra commercio estero e crescita economica:nuova evidenza empirica per l’India," Economia Internazionale / International Economics, Camera di Commercio di Genova, vol. 63(2), pages 217-244.
  3. Akmal, Muhammad Shahbaz & Ahmad, Khalil & Ali, Muhammad, 2009. "Exports-Led Growth Hypothesis in Pakistan: Further Evidence," MPRA Paper 16043, University Library of Munich, Germany.
  4. Helmi Hamdi, 2013. "Testing export-led growth in Tunisia and Morocco: New evidence using the Toda and Yamamoto procedure," Economics Bulletin, AccessEcon, vol. 33(1), pages 677-686.

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