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Export-Led Growth: A Survey of the Empirical Literature and Some Noncausality Results, Part 2

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  • Judith A. Giles

    ()

  • Cara L. Williams

Abstract

This paper continues the investigation of Giles and Williams (2000) on export-led growth (ELG). In the first part, we surveyed the empirical export-led growth literature; it was evident that Granger noncausality tests are commonly applied as a test for ELG. In this paper, we explore the sensitivity of the test for exclusions restrictions often used as the Granger noncauality test for ELG by reconsidering two applications: Oxley’s (1993) study for Portugal and Henriques and Sadorsky’s (1996) analysis for Canada. We focus on robustness to the method adopted to deal with nonstationarity, including the choice of deterministic trend degree. We show that different noncausality outcomes are easy to obtain, and consequently we recommend that readers interpret the empirical ELG literature with care. Our analysis also highlights the importance of examining the robustness of Granger noncauality test results to avoid spurious outcomes in applications.

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Bibliographic Info

Paper provided by Department of Economics, University of Victoria in its series Econometrics Working Papers with number 0002.

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Length: 29 pages
Date of creation: 25 Jan 2000
Date of revision:
Handle: RePEc:vic:vicewp:0002

Note: ISSN 1485-6441
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Keywords: economic growth; causality; time series models; robustness; misspecification; model dimension; cointegration.;

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