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Is per capita real GDP stationary in African countries? Evidence from panel SURADF test

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  • Tsangyao Chang
  • Hsu-Ling Chang
  • Hsiao-Ping Chu
  • Chi-Wei Su

Abstract

This note uses the newly developed panel SURADF tests advanced by Breuer et al. (2001) to investigate the time-series properties of real GDP for 47 African countries for the period 1980 to 2004. While the other Panel-based unit root tests are joint tests of a unit root for all members of the panel and are incapable of determining the mix of I(0) and I(1) series in the panel setting, the Panel SURADF tests a separate unit-root null hypothesis for each individual panel member and, therefore identifies how many and which series in the panel are stationary processes. The empirical results from several panel-based unit root tests indicate that the per capita real GDP for all the countries studied are non-stationary, however, when Breuer et al.'s Panel SURADF tests are conducted, one finds unit root in per capita real GDP only exist in two-third of countries studied. These results have important policy implications for African countries.

Suggested Citation

  • Tsangyao Chang & Hsu-Ling Chang & Hsiao-Ping Chu & Chi-Wei Su, 2006. "Is per capita real GDP stationary in African countries? Evidence from panel SURADF test," Applied Economics Letters, Taylor & Francis Journals, vol. 13(15), pages 1003-1008.
  • Handle: RePEc:taf:apeclt:v:13:y:2006:i:15:p:1003-1008
    DOI: 10.1080/13504850500425881
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    References listed on IDEAS

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    1. Tsangyao Chang & Yuan-Hong Ho & Steven Caudill, 2010. "Is per capita real GDP stationary in China? More powerful nonlinear (logistic) unit root tests," Applied Economics Letters, Taylor & Francis Journals, vol. 17(14), pages 1347-1349.
    2. Breuer, Janice Boucher & McNown, Robert & Wallace, Myles S, 2001. "Misleading Inferences from Panel Unit-Root Tests with an Illustration from Purchasing Power Parity," Review of International Economics, Wiley Blackwell, vol. 9(3), pages 482-493, August.
    3. Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003. "Testing for unit roots in heterogeneous panels," Journal of Econometrics, Elsevier, vol. 115(1), pages 53-74, July.
    4. Taylor, Mark P. & Sarno, Lucio, 1998. "The behavior of real exchange rates during the post-Bretton Woods period," Journal of International Economics, Elsevier, vol. 46(2), pages 281-312, December.
    5. Yin-Wong Cheung & Frank Westermann, 2002. "Output dynamics of the G7 countries--stochastic trends and cyclical movements," Applied Economics, Taylor & Francis Journals, vol. 34(18), pages 2239-2247.
    6. Nelson, Charles R. & Plosser, Charles I., 1982. "Trends and random walks in macroeconmic time series : Some evidence and implications," Journal of Monetary Economics, Elsevier, vol. 10(2), pages 139-162.
    7. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
    8. David E. Rapach, 2002. "Are Real GDP Levels Nonstationary? Evidence from Panel Data Tests," Southern Economic Journal, Southern Economic Association, vol. 68(3), pages 473-495, January.
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    Cited by:

    1. Lee, Chien-Chiang & Lee, Jun-De, 2009. "Income and CO2 emissions: Evidence from panel unit root and cointegration tests," Energy Policy, Elsevier, vol. 37(2), pages 413-423, February.
    2. Vasudeva N. R. Murthy & Emmanuel Anoruo, 2009. "Are Per Capita Real GDP Series in African Countries Non-stationary or Non-linear? What does Empirical Evidence Reveal?," Economics Bulletin, AccessEcon, vol. 29(4), pages 2492-2504.
    3. Dogru, Bülent, 2015. "Is Per Capıta Real GDP Stationary in High Income OECD Countrıes? Evidence from Panel Unıt Root Test With Multiple Structural Breaks," MPRA Paper 63856, University Library of Munich, Germany.
    4. Chang, Tsangyao & Chu, Hsiao-Ping & Ranjbar, Omid, 2014. "Are GDP fluctuations transitory or permanent in African countries? Sequential Panel Selection Method," International Review of Economics & Finance, Elsevier, vol. 29(C), pages 380-399.
    5. Tsangyao Chang, 2011. "Is Per Capita Real GDP Stationary? An Empirical Note for 16 Transition Countries," International Journal of Business and Economics, College of Business and College of Finance, Feng Chia University, Taichung, Taiwan, vol. 10(1), pages 81-86, April.
    6. doğru, bülent, 2013. "Are Output Fluctuations Transitory in the MENA Region?," MPRA Paper 49080, University Library of Munich, Germany.
    7. Tuck Cheong Tang & Evan Lau, 2008. "An Empirical Investigation On The Sustainability Of Balancing Item Of Balance Of Payment Accounts For Oic Member Countries," Monash Economics Working Papers 31/08, Monash University, Department of Economics.
    8. Romero-Ávila, Diego, 2009. "Multiple Breaks, Terms of Trade Shocks and the Unit-Root Hypothesis for African Per Capita Real GDP," World Development, Elsevier, vol. 37(6), pages 1051-1068, June.

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