IDEAS home Printed from https://ideas.repec.org/a/taf/jitecd/v23y2014i6p815-836.html

Economic growth, trade and capital flows: A causal analysis of post-liberalised South Africa

Author

Listed:
  • Sean J. Gossel
  • Nicholas Biekpe

Abstract

Development Finance and EconometricsThis paper investigates the causal relationships between trade, capital inflows and economic growth in post-liberalised South Africa over the period from 1995 to 2011. The results show that economic growth in South Africa is driven primarily by trade and fixed investment rather than by capital inflows. However, the relationship between economic growth and imports is bidirectional, and thus economic growth in South Africa is associated to a greater extent with the export-led growth hypothesis than the import-led growth hypothesis. In addition, the results find in favour of growth-led FDI rather than FDI-led growth, and that portfolio inflows rather than FDI are integrated into the country's trade-led growth dynamics.

Suggested Citation

  • Sean J. Gossel & Nicholas Biekpe, 2014. "Economic growth, trade and capital flows: A causal analysis of post-liberalised South Africa," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 23(6), pages 815-836, September.
    • Handle: RePEc:taf:jitecd:v:23:y:2014:i:6:p:815-836
    DOI: 10.1080/09638199.2013.786118
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09638199.2013.786118
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09638199.2013.786118?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Zeljko Bogetic & Arye Hillman, 2005. "The Tax Base in Transition: The Case of Bulgaria, World Bank Policy Research Working Paper Series No. 1267 (March 1994), The World Bank," Public Economics 0510009, University Library of Munich, Germany.
    2. Jagdish N. Bhagwati, 1978. "Anatomy of Exchange Control Regimes," NBER Chapters, in: Foreign Trade Regimes and Economic Development: Anatomy and Consequences of Exchange Control Regimes, pages 7-52, National Bureau of Economic Research, Inc.
    3. Anne O. Krueger, 1978. "Foreign Trade Regimes and Economic Development: Liberalization Attempts and Consequences," NBER Books, National Bureau of Economic Research, Inc, number krue78-1, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Simplice A. Asongu & Jules R. Minkoua N., 2018. "Dynamic openness and finance in Africa," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 27(4), pages 409-430, May.
    2. Sayef Bakari, 2017. "The Three-Way Linkages Between Export, Import And Economic Growth: New Evidence From Tunisia," Journal of Smart Economic Growth, , vol. 2(3), pages 13-53, December.
    3. Larissa Batrancea & Malar Mozhi Rathnaswamy & Ioan Batrancea, 2021. "A Panel Data Analysis of Economic Growth Determinants in 34 African Countries," JRFM, MDPI, vol. 14(6), pages 1-15, June.
    4. Simplice A. Asongu & Paul N. Acha-Anyi, 2017. "ICT, conflicts in financial intermediation and financial access: evidence of synergy and threshold effects," Netnomics, Springer, vol. 18(2), pages 131-168, December.
    5. Simplice Asongu & Jacinta Nwachukwu, 2017. "Information asymmetry and conditional financial sector development," Journal of Financial Economic Policy, Emerald Group Publishing Limited, vol. 9(4), pages 372-392, November.
    6. Asongu, Simplice A. & Biekpe, Nicholas, 2018. "ICT, information asymmetry and market power in African banking industry," Research in International Business and Finance, Elsevier, vol. 44(C), pages 518-531.
    7. Asamoah, Michael Effah & Alagidede, Imhotep Paul, 2020. "Exploring the causal relationships and allocation puzzle between portfolio investments and real sector growth in Sub-Saharan Africa," Research in International Business and Finance, Elsevier, vol. 52(C).
    8. Asamoah, Michael Effah & Alagidede, Imhotep Paul & Adu, Frank, 2021. "Financial development, portfolio investments and the real economy in Africa," Economic Systems, Elsevier, vol. 45(4).
    9. Yogeeswari Subramaniam & Tajul Ariffin Masron & Nanthakumar Loganathan, 2024. "Imports and Food Security," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 16(1), pages 7-24, January.
    10. Zakaria Yakubu & Nanthakumar Loganathan & Tirta Nugraha Mursitama & Abbas Mardani & Syed Abdul Rehman Khan & Asan Ali Golam Hassan, 2020. "Financial Liberalisation, Political Stability, and Economic Determinants of Real Economic Growth in Kenya," Energies, MDPI, vol. 13(13), pages 1-16, July.
    11. Oladapo FAPETU & Segun Daniel OWOEYE, 2017. "Testing the validity of the export-led growth hypothesis in Nigeria: Evidence from non-oil and oil exports," Computational Methods in Social Sciences (CMSS), "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences, vol. 5(2), pages 41-48, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Shafaeddin, Mehdi, 2010. "Trade liberalization, industrialization and development; experience of recent decades," MPRA Paper 26355, University Library of Munich, Germany.
    2. Irwan Shah Zainal Abidin & Nor Aznin Abu Bakar & Muhammad Haseeb, 2014. "An Empirical Analysis of Exports between Malaysia and TPP Member Countries: Evidence from a Panel Cointegration (FMOLS) Model," Modern Applied Science, Canadian Center of Science and Education, vol. 8(6), pages 238-238, December.
    3. Muhammad Shahbaz & Pervaz Azim & Khalil Ahmad, 2011. "Exports-Led Growth Hypothesis in Pakistan: Further Evidence," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 1(3), pages 182-197.
    4. Khalafalla, Khalid Yousif & Webb, Alan J., 2000. "Exports And Economic Growth Under Structural Change: A Co-Integration Analysis Of Evidence From Malaysia," Working Papers 14595, International Agricultural Trade Research Consortium.
    5. Anne O. Krueger, 2019. "Increased capital mobility and policy reform in developing countries," Indian Economic Review, Springer, vol. 54(1), pages 113-133, December.
    6. Iti Vyas, 2020. "Whether the Economic Growth of India is Trade Openness Led?," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 8(1), pages 38-53.
    7. Manmohan Agarwal & John Whalley, 2013. "The 1991 Reforms, Indian Economic Growth, and Social Progress," NBER Working Papers 19024, National Bureau of Economic Research, Inc.
    8. Utku Utkulu & Durmus Özdemir, 2005. "Does Trade Liberalization Cause a Long Run Economic Growth in Turkey," Economic Change and Restructuring, Springer, vol. 37(3), pages 245-266, September.
    9. Harrison, Ann, 1996. "Openness and growth: A time-series, cross-country analysis for developing countries," Journal of Development Economics, Elsevier, vol. 48(2), pages 419-447, March.
    10. Y Wei & X Liu, 2006. "Productivity spillovers from R&D, exports and FDI in China's manufacturing sector," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(4), pages 544-557, July.
    11. Richard Grabowski & Michael P. Shields, 2000. "A Dynamic, Keynesian Model of Development," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 25(1), pages 1-15, June.
    12. repec:ilo:ilowps:234932 is not listed on IDEAS
    13. Corbo, Vittorio & Fischer, Stanley, 1995. "Structural adjustment, stabilization and policy reform: Domestic and international finance," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 44, pages 2845-2924, Elsevier.
    14. Cleeve, Emmanuel A. & Debrah, Yaw & Yiheyis, Zelealem, 2015. "Human Capital and FDI Inflow: An Assessment of the African Case," World Development, Elsevier, vol. 74(C), pages 1-14.
    15. Udi Joshua & Oladimeji M. Salami & Andrew A. Alola, 2020. "Toward the path of Economic Expansion in Nigeria: The Role of Trade Globalization," Working Papers 20/009, European Xtramile Centre of African Studies (EXCAS).
    16. Syed Tehseen Jawaid, 2014. "Trade Openness and Economic Growth," Foreign Trade Review, , vol. 49(2), pages 193-212, May.
    17. Nasim Shah Shirazi & Turkhan Ali Abdul Manap, 2005. "Export-Led Growth Hypothesis: Further Econometric Evidence From South Asia," The Developing Economies, Institute of Developing Economies, vol. 43(4), pages 472-488, December.
    18. Shafaai, Shafizal & Masih, Mansur, 2018. "The dynamics of growth, exports, exchange rate and foreign direct investment: evidence from Malaysia," MPRA Paper 102538, University Library of Munich, Germany.
    19. Hoekman, Bernard, 2011. "Changing Developing Country Trade Policies and WTO Engagement," CEPR Discussion Papers 8210, C.E.P.R. Discussion Papers.
    20. repec:ilo:ilowps:250014 is not listed on IDEAS
    21. Cunha, Aercio S. & Kyle, Steven, 1989. "Natural Resources, Structural Adjustment, and Sustainable Growth in Sub-Saharan Africa: A Critique of Policy Recommendations," Staff Papers 197578, Cornell University, Department of Applied Economics and Management.
    22. Néstor Gandelman & Verónica Alaimo & Marcelo Olarreaga & José Luis Guasch & Daniel Lederman & Carlos Casacuberta & Ana María Oviedo & J. Humberto López & Inessa Love & Guido Porto & Pablo Fajnzylber &, 2009. "Does the Investment Climate Matter?: Microeconomic Foundations of Growth in Latin America," IDB Publications (Books), Inter-American Development Bank, number 60058 edited by José Luis Guasch & J. Humberto López & Pablo Fajnzylber, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jitecd:v:23:y:2014:i:6:p:815-836. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RJTE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.