scholarly journals Revisit coal consumption, CO2 emissions and economic growth nexus in China and India using a newly developed bootstrap ARDL bound test

2017 ◽  
Vol 36 (3) ◽  
pp. 450-463 ◽  
Author(s):  
Feng-Li Lin ◽  
Roula Inglesi-Lotz ◽  
Tsangyao Chang
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Policy Implications ◽  
Coal Consumption ◽  
Causality Test ◽  
Ardl Model ◽  
Empirical Results ◽  
China And India ◽  
The Government ◽  
Bound Test

This study revisits coal consumption, CO2 emissions and economic growth nexus for both China and India using a newly developed Bootstrap ARDL model over the period of 1969–2015. Empirical results indicate no long-run relationship among these three variables for both China and India, and Granger causality test based on Bootstrap ARDL model indicates a feedback between coal consumption and economic growth, between economic growth and CO2 emissions and between coal consumption and CO2 emissions in China. However, we find a one-way Granger causality running from coal consumption to economic growth and the feedback hypothesis is confirmed between economic growth and CO2 emissions and between coal consumption and CO2 emissions in India. The coefficients signal that coal consumption is an important factor towards the promotion economic growth in both China and India. For China, higher economic growth reduces CO2 emissions, while for India, it further increases CO2 emissions. Our empirical results have important policy implications for the government conducting effective energy polices to promote economic growth in both China and India.

Tax revenue and economic growth in developing country: an autoregressive distribution lags approach

2020 ◽  
Vol 7 (54) ◽  
pp. 205-217
Author(s):  
Mnaku Honest Maganya
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Testing Procedure ◽  
Gdp Growth ◽  
Bounds Testing ◽  
Causality Test ◽  
Significance Level ◽  
Distributed Lag ◽  
Distributed Lag Model ◽  
The Government

AbstractTanzania, like most other developing countries, faces numerous economic challenges in striving to achieve sustainable economic growth and development through taxation. In the literature, the debate on how effective taxes are as a tool for promoting economic growth and economic development remains inconclusive, as various research have reported mixed effects of tax on economic growth. This article investigates the effect of taxation on economic growth in Tanzania using the recently developed technique of autoregressive distributed lag model (ARDL) bounds testing procedure for the period from 1996 to 2019. Various preliminary tests were conducted including stationary tests as well as the pair-wise Granger causality test. According to the results obtained, domestic goods and services (TGS) taxes are positively related to GDP growth and are statistically significant at 1% level. Income taxes, on the other hand, were found to be negatively related to GDP growth and to be statistically significant at 5% level. The pair-wise Granger causality results indicated that there is bidirectional Granger causality between TGS and GDP growth at 1 % significance level. The government should aim at growing, nurturing and sustaining tax base to positively drive economic growth even further.

Globalization and Economic Growth Revisited: A Bootstrap Panel Causality Test

2016 ◽  
Vol 1 (2) ◽  
Author(s):  
 Hsiao-Ping Chu ◽  
Tsangyao Chang ◽  
Tagi Sagafi-nejad
Keyword(s):  
Economic Growth ◽  
Oecd Countries ◽  
Policy Implications ◽  
Causality Test ◽  
Panel Causality ◽  
Empirical Results ◽  
Panel Granger Causality ◽  
The Us ◽  
Direction Of Causation ◽  
The Uk

This paper revisits the nature and direction of causation between globalization and economic growth in nine OECD countries and China by applying the bootstrap panel Granger causality test to the data over the period of 1981-2008. Empirical results support evidence on causality from globalization to economic growth for Netherlands and the UK; causality from economic growth to globalization in the US, neutrality for Australia, Belgium, Canada, France, Italy, and Japan. Based on the empirical results from this paper, we provide important policy implications for the OECD countries and China.

Analysis of capital formation and foreign aid nexus in Nigeria

2019 ◽  
Vol 14 (2) ◽  
pp. 266-280 ◽  
Author(s):  
Anthony Orji ◽  
Jonathan E. Ogbuabor ◽  
Onyinye Imelda Anthony-Orji ◽  
Chibudem O. Mbonu
Keyword(s):  
Foreign Aid ◽  
Granger Causality ◽  
Granger Causality Test ◽  
Capital Formation ◽  
Causality Test ◽  
Effective Utilization ◽  
Ardl Model ◽  
Content Type ◽  
Empirical Results ◽  
Development Goals

Purpose The issue of foreign aid has continued to gain renewed economic cum political attention in the early years of the twenty-first century. At a summit, popularly known as the Millennium Summit, which took place in 2000, there was an agreement by the international community concerning some goals known as the Millennium Development Goals which were targeted to be reached by the year 2015 but have now been replaced by the Sustainable Development Goals. Against this background, it becomes pertinent to ascertain the contributions and impact of foreign aid in the form of Overseas Development Assistance (ODA) on capital formation in Nigeria. This is an area of foreign aid studies that has been ignored by many researchers. Most studies are seen delving into analyzing the aid-growth nexus without evaluating the transmission link through which foreign aid transmits to affect economic growth. There is paucity of studies on the aid-capital nexus. The paper aims to discuss these issues. Design/methodology/approach The empirical method used was autoregressive distributed lag (ARDL) model. Findings The empirical results from the ARDL model estimations show that foreign aid, which is proxied by ODA, has a positive and significant impact on capital formation in Nigeria for the years under analysis. The result of the Granger causality test shows that a bi-directional granger causality exists between foreign aid and gross fixed capital formation (GFCF). Originality/value Empirical results from the ARDL model estimations show that foreign aid, which is proxied by ODA, has a positive and significant impact on capital formation in Nigeria for the years under analysis. The result of the Granger causality test shows that a bi-directional Granger causality exists between foreign aid and GFCF. It is therefore recommended that government should make serious efforts toward the implementation and effective utilization of foreign aid. Appropriate policy measures that would monitor the maximum and effective utilization of foreign aid are also required.

scholarly journals Coal consumption and economic growth nexus: Evidence from bootstrap panel Granger causality test

2017 ◽  
Vol 64 (3) ◽  
pp. 255-271 ◽  
Author(s):  
Emmanuel Anoruo
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Unit Root ◽  
Unit Root Test ◽  
Granger Causality Test ◽  
African Countries ◽  
Coal Consumption ◽  
Causality Test ◽  
Growth Series ◽  
Panel Granger Causality

This paper explores the causal relationship between coal consumption and economic growth for a panel of 15 African countries using bootstrap panel Granger causality test. Specifically, this paper uses the Phillips-Perron unit root test to ascertain the order of integration for the coal consumption and economic growth series. A bootstrap panel Granger causality test is employed to determine the direction of causality between coal consumption and economic growth. The results provide evidence of unidirectional causality from economic growth to coal consumption. This finding implies that coal conservation measures may be implemented with little or no adverse impact on economic growth for the sample countries as a group.

scholarly journals Impacts of Economic Structural Change on Economic Growth: Forecasting Models and Policy Implications (A Case Study of Bến Tre Province)

2013 ◽  
Vol 218 ◽  
pp. 20-36
Author(s):  
Hổ Đinh Phi ◽  
DUY NGUYỄN KHÁNH
Keyword(s):  
Economic Growth ◽  
Structural Change ◽  
National Development ◽  
Quantitative Model ◽  
Policy Implications ◽  
Causality Test ◽  
Policy Makers ◽  
Service Sectors ◽  
The Government

During the past ten years, economic growth in Vietnam changed positively in the direction of a modern industrial economy. Accordingly, economic structure also experienced changes in which manufacturing and service sectors accounted for a bigger share in the GDP. The government and most researchers are therefore very interested in economic structural change. This structural change in Vietnam as a whole requires the same change in local economies. However, some provinces did not catch up with the national development yet. Thus, in order to facilitate structural change on the whole economy, it is necessary to clarify what economic structural change aims at, and identify a quantitative model for measuring impact of such change, which becomes a real challenge to Vietnam?s researchers and policy makers. To help solve this problem, the authors conducted a case study in B?n Tre to seek practical evidence. The results, based on regressive model, VAR model and Granger causality test, show that economic structural change impacts on the level of economic growth, labor productivity and the quality of life. This research also lays the foundation for a model for forecasting impacts of economic structural change.

scholarly journals Economic Growth And Unemployment: An Empirical Assessment of Okun’s Law In The Case of Liberia

2021 ◽  
Author(s):  
Kaiballah Conteh
Keyword(s):  
Economic Growth ◽  
Unit Root Test ◽  
Policy Implications ◽  
Causality Test ◽  
Flexible Labor ◽  
Long Run ◽  
Integration Test ◽  
Augmented Dickey Fuller ◽  
Auto Regressive ◽  
The Government

The aim of this research is to look at the relationship between economic growth and unemployment in Liberia from 2001 to 2019. To investigate the association between unemployment and Gross Domestic Product (GDP), the unit root test, the Augmented Dickey-Fuller (ADF) Co-integration test, and the Standard Granger Causality test were used. The Auto Regressive Distribution Lag (ARDL) bounds test is used to decide if the variables have a long run linkage. The ARDL model findings indicate that there is no long-run association between unemployment and economic growth. The findings of this analysis have especially significant policy implications for Liberian economic policymakers. The observational findings revealed a negligible association between unemployment and economic growth in both the long and short term. The Liberian government should redirect its spending toward activities that directly and indirectly promote the creation of employment and decent jobs, a conducive environment and flexible labor market policies or legislation that are not impediments to job creation should be created, and finally, the government should prioritize industries that promote labor intensive.

Intertemporal change in the effect of economic growth on carbon emission in China

2021 ◽  
pp. 0958305X2110086
Author(s):  
Jingwen Zhang ◽  
Yin Dai ◽  
Chi-Wei Su ◽  
Dervis Kirikkaleli ◽  
Muhammad Umar
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Carbon Emissions ◽  
Energy Demand ◽  
Renewable Energy Sources ◽  
Causality Test ◽  
Industrial Upgrading ◽  
Full Sample ◽  
Causality Tests ◽  
The Government

This research examines the factor of causality between the variables of economic growth and carbon emissions in China, by conducting full, and sub-sample Granger causality tests for the period of 1965 to 2019. The full-sample Granger causality test is not considered to be authentic, and is rather unstable, as indicated by the parameter stability tests. Therefore, we consider the time variation using a causality test, and the results indicate that the causality exists from the Gross Domestic Product (GDP) growth to the Carbon Dioxide (CO2) emissions. This development essentially suggests that economic growth is critical for China's environment. It also implies that carbon emissions are mainly determined by the increase in economic growth, at some specific period in time. Thus, in this regard, the use of renewable energy sources should be encouraged by policymakers, in order to deal with rise in the energy demand, and promote industrial upgrading, so as to slow down the rate degradation that the environment have been experiencing. However, our empirical results indicate that CO2 emissions are not the Granger reason to GDP. In this case, the government can formulate more conservative reduction policies that pertain to carbon emissions, and will therefore, not impede the economic growth.

Research on the Dynamic Relationship between Energy Consumption Structure and Economic Growth in China

2014 ◽  
Vol 1010-1012 ◽  
pp. 1976-1979
Author(s):  
Li Jiang
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Energy Consumption ◽  
Granger Causality ◽  
Dynamic Equilibrium ◽  
Coal Consumption ◽  
Causality Test ◽  
Positive Effects ◽  
Equilibrium Relationship ◽  
The Impact

With the increasingly development of economy in China, economic growth and efficient use of energy is a hot topic in recent years, also China is under pressure of carbon emissions reductions during the process of economic development. This paper try to do a research to find weather the structure of energy consumption and economic growth exist long-term dynamic equilibrium relationship. Based on VAR model, though Granger causality test, impulse response and variance decomposition, combined with China's development of low-carbon economy, in the years between1978 to 2012 , four results has been showed: First, China's economic growth and energy consumption exist a stable long-run equilibrium relationship. Second, at the 1% level, there is a two-way Granger causality coal consumption and economic growth. Third, in lag 4, the energy consumption is produced positive effects on economic growth and the impact of coal consumption has maximum affect. Forth, the development and utilization of renewable energy is an effective way to solve China's economic development and energy constraints contradictory.

Effect of Terms of Trade on Economic Growth of China

2018 ◽  
Vol 4 (2) ◽  
pp. 157-168 ◽  
Author(s):  
Khalil Jebran ◽  
Amjad Iqbal ◽  
Kalim-Ullah Bhat ◽  
Arshad Ali
Keyword(s):  
Economic Growth ◽  
Labor Force ◽  
Granger Causality ◽  
Variance Decomposition ◽  
Terms Of Trade ◽  
Causality Analysis ◽  
Causality Test ◽  
Ardl Model ◽  
Long Run ◽  
Short Run

This study investigates the effect of terms of trade (TOT) on the economic growth of China over the period 1980–2013. Autoregressive distributed lag (ARDL) model proposed by Pesaran, Shin, and Smith (2001, Journal of Applied Econometrics, 16(3), pp. 289–326) is applied for examining the short-run and long-run associations. The causality analysis between variables is analyzed by using Granger causality test and variance decomposition test. The ARDL model reveals that TOT significantly and adversely affect economic growth in the short run as well as in the long run. The results also imply positive short-run and long-run effect of labor and capital on the economic growth of China. The Granger causality results reveal significant bidirectional causal relationship between economic growth and capital, and between capital and labor force. The results show unidirectional causality from TOT to labor force. The variance decomposition results show that most of the innovation in economic growth is explained by its own innovation, while other variables have very small contributions to its innovations. The notable findings of the study suggest that TOT deterioration is relatively important for enhancing the economic growth of China.

Financial development, oil dependence and economic growth

2017 ◽  
Vol 34 (2) ◽  
pp. 281-298 ◽  
Author(s):  
Ramez Abubakr Badeeb ◽  
Hooi Hooi Lean
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Financial Development ◽  
Granger Causality Test ◽  
Financial Sector ◽  
Causality Test ◽  
Content Type ◽  
The Government ◽  
The Impact ◽  
The Relationship

Purpose This paper aims to examine the validity of the question of whether oil dependence has a negative impact on the relationship between financial development and economic growth in Yemen. Design/methodology/approach The auto-regressive distributed lag approach for cointegration is used to examine the relationship between financial development and economic growth by capturing the impact of oil dependence on this relationship. The Granger causality test, based on a vector error correction model (VECM) framework, is used to investigate the causal relationships between financial development and economic growth. Findings The most interesting finding is the negative sign of interaction term between financial development and oil dependence, which implies that the positive effect of financial development on economic growth decreases with the increasing oil dependence. The result of the VECM Granger causality test revealed the existence of unidirectional causality running from financial development to economic growth. Research limitations/implications The short sample period and the worry of losing degrees of freedom limited us when including control variables in the model. If the data are available in the future, other control variables can be added. Practical implications The government should reduce the level of oil dependence in Yemen by diversifying the country’s economy. Accelerating the pace and efficiency of the financial sector will bear fruitful returns in this regard. The government could achieve this strategy by playing a more proactive role in encouraging the expansion of credit to enable the financial sector to provide a more efficient intermediary role in mobilizing domestic savings and channeling them to productive investments across various economic sectors. Originality/value This is the first study to examine the impact of oil dependence on the finance-growth nexus in Yemen. A new indicator for oil dependence is also proposed.

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