The Causal Relationship between Imports and Economic Growth in the Nine Provinces of South Africa: Evidence from Panel-Granger Causality Tests
AbstractThis paper examines the causal relationship between imports and growth in nine provinces of South Africa for the period 1996-2011, using panel causality analysis, which accounts for cross-section dependency and heterogeneity across regions. Our empirical results support unidirectional causality running from economic growth to imports for Gauteng, Mpumalanga, North West, and Western Cape; a bi-directional causality between imports and economic growth for KwaZulu-Natal; and no causality in any direction between economic growth and imports for the rest of provinces. This suggests that import liberalisation might not be an efficient strategy to improve provincial economic performance in South Africa. Indeed, provincial imports tend to increase in some provinces as economic growth improves.
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Bibliographic InfoPaper provided by University of Pretoria, Department of Economics in its series Working Papers with number 201320.
Length: 19 pages
Date of creation: Apr 2013
Date of revision:
Imports; Economic Growth; Dependency and Heterogeneity; Panel Causality Test;
Other versions of this item:
- Tsangyao Chang & Beatrice D. Simo-Kengne & Rangan Gupta, 2013. "The Causal Relationship between Exports and Economic Growth in the Nine Provinces of South Africa: Evidence from Panel-Granger Causality Tests," Working Papers 201319, University of Pretoria, Department of Economics.
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-AFR-2013-04-27 (Africa)
- NEP-ALL-2013-04-27 (All new papers)
- NEP-FDG-2013-04-27 (Financial Development & Growth)
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