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An economic growth model: Evaluating the interaction of market consumption with GDP growth rate in Afghanistan

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  • Azimi, Mohammad Naim

Abstract

In this paper, we argue that the market consumption is one of the major and significant elements of Gross Domestic Product driver in Afghanistan for which the competeting null hypothesis that consumption drives the GDP growth is tested. The statistical analysis based on Semi-long regression economic growth model shows a significant corresponding probability value of 0.000 which shows that consumption drives GDP growth while the coefficient exhibits 0.1534 or 15.34% growth of GDP driven by consumption throughout the period 2001 to 2014. Further statistical analysis obtained from the Breusch-Godfrey and Breusch – Pegan-Godfrey LM tests for investigating the existence of any serial correlation within the series support us to reject the null hypothesis that there is no serial correlation within the series. On the other hand, the Jarque-Bera test of normality shows a p-value of 0.3099 which is significant and further documents that the residuals are random and normally distributed within the series.

Suggested Citation

  • Azimi, Mohammad Naim, 2016. "An economic growth model: Evaluating the interaction of market consumption with GDP growth rate in Afghanistan," MPRA Paper 69517, University Library of Munich, Germany, revised 11 Jan 2016.
  • Handle: RePEc:pra:mprapa:69517
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    File URL: https://mpra.ub.uni-muenchen.de/69517/1/MPRA_paper_69517.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Market Consumption; GDP; Homoskedasticity; Heteroskedasticity; Economic Growth;

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • G1 - Financial Economics - - General Financial Markets
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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