IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/45654.html
   My bibliography  Save this paper

Are Thai Manufacturing Exports and Imports of Capital Goods Related?

Author

Listed:
  • Jiranyakul, Komain

Abstract

This paper examines the relationship between manufacturing exports and imports of capital goods in Thailand using monthly data from January 2000 to July 2011. The results from bounds testing for cointegration show that there exists long-run equilibrium relationship between exports and imports of capital goods in manufacturing sector. In addition, the positive relationship between the growth rate of imports of capital goods and the growth rate of manufacturing exports is observed. The results support the notion that foreign capital is essential in the process of industrialization, and thus economic growth. A decline in imports of capital goods will reduce manufacturing exports and impedes economic growth in the future. It is also likely that exports of manufactured products are the main source of foreign exchanges to finance imports of capital goods which cannot be produced in the country due to comparative disadvantage.

Suggested Citation

  • Jiranyakul, Komain, 2011. "Are Thai Manufacturing Exports and Imports of Capital Goods Related?," MPRA Paper 45654, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:45654
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/45654/9/MPRA_paper_45654.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. SEKMEN, Fuat & SARIBAS, Hakan, 2007. "Cointegration And Causality Among Exchange Rate, Export, And Import: Empirical Evidence From Turkey," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(2), pages 71-78.
    2. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    3. Caselli, Francesco & Wilson, Daniel J., 2004. "Importing technology," Journal of Monetary Economics, Elsevier, vol. 51(1), pages 1-32, January.
    4. Temple, Jonathan, 1998. "Equipment Investment and the Solow Model," Oxford Economic Papers, Oxford University Press, vol. 50(1), pages 39-62, January.
    5. Dulleck, Uwe & Foster, Neil, 2008. "Imported Equipment, Human Capital and Economic Growth in Developing Countries," Economic Analysis and Policy, Elsevier, vol. 38(2), pages 233-250, September.
    6. Eaton, Jonathan & Kortum, Samuel, 2001. "Trade in capital goods," European Economic Review, Elsevier, vol. 45(7), pages 1195-1235.
    7. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    8. Arize, Augustine C., 2002. "Imports and exports in 50 countries: Tests of cointegration and structural breaks," International Review of Economics & Finance, Elsevier, vol. 11(1), pages 101-115, April.
    9. Lee, Jong-Wha, 1995. "Capital goods imports and long-run growth," Journal of Development Economics, Elsevier, vol. 48(1), pages 91-110, October.
    10. Komain Jiranyakul, 2010. "Recent evidence of the validity of the export-led growth hypothesis for Thailand," Economics Bulletin, AccessEcon, vol. 30(3), pages 2151-2159.
    11. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-438, July.
    12. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-1580, November.
    13. MacKinnon, James G, 1996. "Numerical Distribution Functions for Unit Root and Cointegration Tests," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 11(6), pages 601-618, Nov.-Dec..
    14. J. Bradford De Long & Lawrence H. Summers, 1991. "Equipment Investment and Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 445-502.
    15. Mazumdar, Joy, 2001. "Imported machinery and growth in LDCs," Journal of Development Economics, Elsevier, vol. 65(1), pages 209-224, June.
    16. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    17. Krugman, Paul, 1981. "Trade, accumulation, and uneven development," Journal of Development Economics, Elsevier, vol. 8(2), pages 149-161, April.
    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. Abdulla S. Al-Khulaifi, 2013. "Exports and Imports in Qatar: Evidence from Cointegration and Error Correction Model," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(9), pages 1122-1133, September.
    2. Damilola Felix Arawomo, 2014. "Manufacturing Exports and Import of Capital Goods Nexus: the Nigeria's Case," Economics Bulletin, AccessEcon, vol. 34(3), pages 1522-1529.
    3. Aleh Mazol, 2015. "Exchange Rate, Imports of Intermediate and Capital Goods and GDP Growth in Belarus," BEROC Working Paper Series 32, Belarusian Economic Research and Outreach Center (BEROC).
    4. Antwi-Boateng, Cosmos, 2015. "Is Ghana achieving sustainable trade balance in the participation of international trade? time series assessment for Ghana," MPRA Paper 67268, University Library of Munich, Germany.

    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. Aurora A.C. Teixeira & Natércia Fortuna, 2006. "Human capital, trade and long-run productivity. Testing the technological absorption hypothesis for the Portuguese economy, 1960-2001," FEP Working Papers 226, Universidade do Porto, Faculdade de Economia do Porto.
    2. Aleh Mazol, 2015. "Exchange Rate, Imports of Intermediate and Capital Goods and GDP Growth in Belarus," BEROC Working Paper Series 32, Belarusian Economic Research and Outreach Center (BEROC).
    3. Balsalobre-Lorente, Daniel & Bekun, Festus Victor & Etokakpan, Mfonobong Udom & Driha, Oana M., 2019. "A road to enhancements in natural gas use in Iran: A multivariate modelling approach," Resources Policy, Elsevier, vol. 64(C).
    4. Sulaiman, Saidu & Masih, Mansur, 2017. "Is liberalizing finance the game in town for Nigeria ?," MPRA Paper 95569, University Library of Munich, Germany.
    5. Maparu, Tuhin Subhra & Mazumder, Tarak Nath, 2017. "Transport infrastructure, economic development and urbanization in India (1990–2011): Is there any causal relationship?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 100(C), pages 319-336.
    6. Ali, Amjad & Ur Rehman, Hafeez, 2015. "Macroeconomic Instability and Its Impact on Gross Domestic Product: An Empirical Analysis of Pakistan," MPRA Paper 71037, University Library of Munich, Germany.
    7. Mohammad Jaforullah & Alan King, 2015. "is New Zealand's economy vulnerable to world oil market shocks?," Working Papers 1503, University of Otago, Department of Economics, revised Mar 2015.
    8. Francisco Rebelo & Ester Gomes da Silva, 2013. "Export variety, technological content and economic performance: The case of Portugal," Papers in Evolutionary Economic Geography (PEEG) 1310, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Jun 2013.
    9. Hussain Ali Bekhet & Raed Walid Al-Smadi, 2016. "The dynamic causality between FDI inflow and its determinants in Jordan," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 11(1), pages 26-47.
    10. Xibing Li & Jiao Liu & Jian Zhou & Xiling Liu & Lei Zhou & Wei Wei, 2020. "The Effects of Macroeconomic Factors on Road Traffic Safety: A Study Based on the ARDL-ECM Model," Sustainability, MDPI, vol. 12(24), pages 1-16, December.
    11. Dulleck, Uwe & Foster, Neil, 2008. "Imported Equipment, Human Capital and Economic Growth in Developing Countries," Economic Analysis and Policy, Elsevier, vol. 38(2), pages 233-250, September.
    12. ŞENTÜRK, İsmail & Ali, Amjad, 2019. "Socioeconomic Determinants of Gender Specific Life Expectancy in Turkey: A Time Series Analysis," MPRA Paper 97815, University Library of Munich, Germany.
    13. Xiarchos, Irene M. & Fletcher, Jerald J., 2009. "Price and volatility transmission between primary and scrap metal markets," Resources, Conservation & Recycling, Elsevier, vol. 53(12), pages 664-673.
    14. Muhammad Shahbaz & Talat Afza & Muhammad Shahbaz Shabbir, 2013. "Does Defence Spending Impede Economic Growth? Cointegration And Causality Analysis For Pakistan," Defence and Peace Economics, Taylor & Francis Journals, vol. 24(2), pages 105-120, April.
    15. Sugra Humbatova, 2023. "The Impact of Oil Prices on State Budget Income and Expenses: Case of Azerbaijan," International Journal of Energy Economics and Policy, Econjournals, vol. 13(1), pages 189-212, January.
    16. Landon, Stuart & Smith, Constance E., 2009. "Investment and the exchange rate: Short run and long run aggregate and sector-level estimates," Journal of International Money and Finance, Elsevier, vol. 28(5), pages 813-835, September.
    17. Ali, Amjad & Bibi, Chan, 2016. "Determinants of Social Progress and its Scenarios under the role of Macroeconomic Instability: Empirics from Pakistan," MPRA Paper 72920, University Library of Munich, Germany.
    18. Dagher, Leila & El Hariri, Sadika, 2013. "The impact of global oil price shocks on the Lebanese stock market," Energy, Elsevier, vol. 63(C), pages 366-374.
    19. T. Thanh-Binh Nguyen & Kuan-Min Wang, 2010. "Causality between housing returns, inflation and economic growth with endogenous breaks," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 8(1), pages 95-115.
    20. Nur Setyowati, 2019. "Macroeconomic Determinants of Islamic Banking Products in Indonesia," Economies, MDPI, vol. 7(2), pages 1-15, June.

    More about this item

    Keywords

    Manufacturing Exports; Imports of Capital Goods; Economic Growth; Cointegration; Causality;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

    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:pra:mprapa:45654. 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: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    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.