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Export-led growth in the UAE: multivariate causality between primary exports, manufactured exports and economic growth

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  • Athanasia S. Kalaitzi

    () (Manchester Metropolitan Business School)

  • Emmanuel Cleeve

    () (Manchester Metropolitan Business School)

Abstract

The principal question that this research addresses is the validity of the Export-Led Growth hypothesis (ELG) in the United Arab Emirates (UAE) over the period 1981–2012, focusing on the causality between primary exports, manufactured exports and economic growth. Unit root tests are applied to examine the time-series properties of the variables, while the Johansen cointegration test is performed to confirm or not the existence of a long-run relationship between the variables. Moreover, the multivariate Granger causality test and a modified version of Wald test are applied to examine the direction of the short-run and long-run causality respectively. The cointegration analysis reveals that manufactured exports contribute more to economic growth than primary exports in the long-run. In addition, this research provides evidence to support a bi-directional causality between manufactured exports and economic growth in the short-run, while the Growth-Led Exports (GLE) hypothesis is valid in the long-run for UAE.

Suggested Citation

  • Athanasia S. Kalaitzi & Emmanuel Cleeve, 2018. "Export-led growth in the UAE: multivariate causality between primary exports, manufactured exports and economic growth," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 8(3), pages 341-365, September.
  • Handle: RePEc:spr:eurasi:v:8:y:2018:i:3:d:10.1007_s40821-017-0089-1
    DOI: 10.1007/s40821-017-0089-1
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    Cited by:

    1. Abdul Rashid & M. Kabir Hassan & Hafsa Karamat, 0. "Firm size and the interlinkages between sales volatility, exports, and financial stability of Pakistani manufacturing firms," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 0, pages 1-24.
    2. Daouda Coulibaly & Fulgence Zran Goueu, 2019. "An Empirical Analysis of the Link between Economic Growth and Exports in Côte d’Ivoire," International Business Research, Canadian Center of Science and Education, vol. 12(9), pages 94-104, September.
    3. Titus Isaiah Zayone & Shida Rastegari Henneberry & Riza Radmehr, 2020. "Effects of Agricultural, Manufacturing, and Mineral Exports on Angola’s Economic Growth," Energies, MDPI, Open Access Journal, vol. 13(6), pages 1-17, March.

    More about this item

    Keywords

    Export-led Growth; Diversification; Economic growth; Causality; UAE;

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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