How trade and foreign investment affect the growth of a small but not so open economy: Australia?
AbstractThis article analyses the impact of trade and foreign investment on a small but not so open economy, Australia, whose growth rate outpaced the majority of the OECD countries in the last decade. We model five channels of outward orientation: exports, imports, foreign direct investment, foreign portfolio investment and other foreign investment. A cointegrated vector autoregressive model, complemented by a robust Granger noncausality test, is specified to identify permanent channels of outward orientation. Imports and direct investment are found to have a growth effect in the long run. The effect of imports is almost three times that of direct investment.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Applied Economics.
Volume (Year): 41 (2009)
Issue (Month): 12 ()
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- Kishor Sharma & Pemasiri J. Gunawardana, 2012. "The role of price and nonprice factors in predicting Australia's trade performance," Applied Economics, Taylor & Francis Journals, vol. 44(21), pages 2679-2686, July.
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