scholarly journals The Relation between Tourism and Economic Growth: A Case of Saudi Arabia as an Emerging Tourism Destination

2020 ◽  
Vol 3 (4) ◽  
pp. 29-47
Author(s):  
Lamia Jamel
Keyword(s):  
Economic Growth ◽  
Saudi Arabia ◽  
Granger Causality ◽  
Co2 Emissions ◽  
Financial Development ◽  
Positive Impact ◽  
Trade Openness ◽  
Granger Causality Test ◽  
Annual Data ◽  
Causality Test

This paper examines empirically the relation between tourism and economic growth in Saudi Arabia. The authors try to justify how tourism contributes to the economic growth of Saudi Arabia. There are applied descriptive statistics, unit root test, VAR model and Granger Causality test as an econometric methodology to examine the connection between tourism and economic growth in Saudi Arabia for the annual data in the period from 1990 to 2018. The main empirical results of the study find out that tourism affects positively the economic growth in Saudi Arabia. Also, there is found a positive nexus among tourism and economic growth. Furthermore, CO2 emissions and financial development impact positively the tourism sector, while trade openness predicts a negative effect on tourism. Additionally, CO2 emissions, financial development, and trade openness have a positive impact on economic growth in Saudi Arabia. Finally, the Granger causality test provides evidence of bidirectional nexus between tourism and economic growth in Saudi Arabia. This paper contributes to the current research by explaining the causal nexus among tourism and economic growth in Saudi Arabia during the period from 1990 to 2018, applying a vector autoregressive model and Granger Causality.

Relationships between Financial Development, Trade Openness, and Economic Growth

2015 ◽  
pp. 183-196
Author(s):  
Fahri Seker ◽  
Murat Cetin ◽  
Birol Topcu ◽  
Gamze Yıldız Seren
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Financial Development ◽  
Trade Openness ◽  
Granger Causality Test ◽  
Bounds Testing ◽  
Causality Test ◽  
Vector Error Correction ◽  
Long Run ◽  
Short Run

The aim of this chapter is to investigate the cointegration and causal relationship between financial development, trade openness, and economic growth in Turkey for the period of 1980-2012. To analyze the data, the bounds testing and Johansen-Juselius approaches to cointegration and Granger causality test based on vector error-correction model are employed. The cointegration tests suggest that there is a long-run relationship between the variables. The Granger causality test reveals long-run bidirectional causality between trade openness and economic growth. The findings also indicate unidirectional causality running from financial development to trade openness and economic growth in the long run as well as a bi-directional causality between financial development and economic growth in the short run. The results support supply-leading and trade-led growth hypotheses. Therefore, it can be suggested that Turkey can accelerate its economic growth by improving its financial systems and encouraging foreign trade.

The relationship between financial development and economic growth in Eswatini (formerly Swaziland)

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Siphe-okuhle Fakudze ◽  
Asrat Tsegaye ◽  
Kin Sibanda
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Financial Development ◽  
Granger Causality Test ◽  
Causality Test ◽  
Content Type ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
The Relationship

PurposeThe paper examined the relationship between financial development and economic growth for the period 1996 to 2018 in Eswatini.Design/methodology/approachThe Autoregressive Distributed Lag bounds test (ARDL) was employed to determine the long-run and short-run dynamics of the link between the variables of interest. The Granger causality test was also performed to establish the direction of causality between financial development and economic growth.FindingsThe ARDL results revealed that there is a long-run relationship between financial development and economic growth. The Granger causality test revealed bidirectional causality between money supply and economic growth, and unidirectional causality running from economic growth to financial development. The results highlight that economic growth exerts a positive and significant influence on financial development, validating the demand following hypothesis in Eswatini.Practical implicationsPolicymakers should formulate policies that aims to engineer more economic growth. The policies should strike a balance between deploying funds necessary to stimulate investment and enhancing productivity in order to enliven economic growth in Eswatini.Originality/valueThe study investigates the finance-growth linkage using time series analysis. It determines the long-run and short-run dynamics of this relationship and examines the Granger causality outcomes.

scholarly journals Financial Development and Economic Growth: Time Series Analysis of Economy of Pakistan

2018 ◽  
Vol 5 (2) ◽  
pp. 59
Author(s):  
Muhammad Shoukat Malik ◽  
Raisham Hayee ◽  
Raima Adeel
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Time Series Analysis ◽  
Causal Relationship ◽  
Financial Development ◽  
Granger Causality Test ◽  
Growth Time ◽  
Annual Data ◽  
Causality Test ◽  
Stationary Level

This study aims in understanding the causal relationship between financial development and economic growth. This research used annual data and applied dickey fuller test and granger causality test in order to understand stationary level and causation in variables. The results of this test give support to first hypothesis that financial development causes economic growth. While no evidence was found on the support of our second hypothesis i.e. economic growth is causing financial development.

scholarly journals TRADE OPENNESS AND ECONOMIC GROWTH: EMPIRICAL EVIDENCE FROM INDIA

2014 ◽  
Vol 16 (1) ◽  
pp. 188-205 ◽  
Author(s):  
Qazi Muhammad Adnan Hye ◽  
Wee-Yeap Lau
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Granger Causality ◽  
Trade Openness ◽  
Granger Causality Test ◽  
Causality Test ◽  
Long Run ◽  
Rolling Window ◽  
Short Run ◽  
The Impact

The main objective of this study is to develop first time trade openness index and use this index to examine the link between trade openness and economic growth in case of India. This study employs a new endogenous growth model for theoretical support, auto-regressive distributive lag model and rolling window regression method in order to determine long run and short run association between trade openness and economic growth. Further granger causality test is used to determine the long run and short run causal direction. The results reveal that human capital and physical capital are positively related to economic growth in the long run. On the other hand, trade openness index negatively impacts on economic growth in the long run. The new evidence is provided by the rolling window regression results i.e. the impact of trade openness index on economic growth is not stable throughout the sample. In the short run trade openness index is positively related to economic growth. The result of granger causality test confirms the validity of trade openness-led growth and human capital-led growth hypothesis in the short run and long run.

scholarly journals Impact of FDI on Provincial Economic Growth in Vietnam

2014 ◽  
Vol 221 ◽  
pp. 65-84
Author(s):  
THÀNH SỬ ĐÌNH ◽  
Tiến Nguyễn Minh
Keyword(s):  
Economic Growth ◽  
Human Resources ◽  
Granger Causality ◽  
Trade Openness ◽  
Private Investment ◽  
Granger Causality Test ◽  
Controversial Issue ◽  
Causality Test ◽  
The Impact

The impact of foreign direct imvestment (FDI) on economic growth is still a highly controversial issue as remarked by many researchers (Aitken et al.; 1997; Carkovic & Levine, 2002; Bende-Nabende et al., 2003; Durham, 2004; and Hsiao, 2006). Using a panel dataset of 43 provinces in Vietnam during 1997 – 2012 and the Granger causality test by Arellano-Bond GMM and PMG estimation, this paper shows that: (i) FDI does Granger-cause private investment, human resources, taxation, infrastructure, trade openness and local technology; (ii) FDI has a positive impacts on provincial economic growth in the long term; and (iii) FDI flows vary over provinces due to differences in geographical conditions and level of development.

scholarly journals Economic Growth, Domestic Investment, Real Exchange Rate and Trade Openness in India: A multi-cointegration analysis

2016 ◽  
Vol 12 (3) ◽  
pp. 169-184
Author(s):  
Md. Samsur Jaman
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Real Exchange Rate ◽  
Granger Causality ◽  
Trade Openness ◽  
Granger Causality Test ◽  
Domestic Investment ◽  
Causality Test ◽  
Long Run ◽  
Short Run

This study examines the relationships between economic growth, gross domestic investment, real exchange rate and trade openness in Indian Economy using the Johansen –Juselius cointegration test and VEC Granger causality test. The results suggest that there exists a long-run relationship among the variables. All the estimated coefficients of the long-run equation have the correct positive signs and significant at least at the 5 per cent level. Specifically, in the long run, a 1% increase in Gross Domestic Investment (GDI) increases 0.066% in economic growth. Similarly, a 1% increase in trade openness leads to 0.082% increase in economic growth and a 1% increase in real exchange rate leads to 0.26% increase in economic growth. Thus, in the long run, Gross Domestic Investment (GDI), trade openness and real exchange rate have positively impact on economic growth. The results from the VEC Granger causality test suggest that in the short run only economic growth has short run impact on Gross Domestic Investment (GDI). The other variables have no short run impact on each other. Thus, there is a unidirectional causality from economic growth to GDI, but there is no feedback effect.

scholarly journals Petroleum Consumption and Financial Development in Malaysia

2016 ◽  
Author(s):  
Jen-Eem Chen ◽  
Yan-Ling Tan ◽  
Chin-Yu Lee ◽  
Lim-Thye Goh
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Granger Causality ◽  
Financial Development ◽  
Granger Causality Test ◽  
Financial Sector ◽  
Causality Test ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Long Run

This paper aims to contribute to the existing literature by examining the dynamic relationship among petroleum consumption, financial development, economic growth and energy price. The sample of this study is based on the Malaysian annual data from 1980 to 2010. The model specification was examined in the Autoregressive Distributed Lag (ARDL) framework and the results revealed the existence of a long-run equilibrium. The findings indicated that financial development and economic growth cause a demand for energy to escalate in the long run. The Toda-Yamamoto (TYDL) non Granger-causality test provides evidence that there is unidirectional Granger-causality running from financial development and economic growth to energy consumption in the long run. This suggests that Malaysia is not an energy-dependent country. Hence, the government could implement energy conservation policies to reduce the waste of energy use. Given that development in the financial sector, and economic growth increase petroleum consumption in Malaysia, the policies pertaining to energy consumption should incorporate the development of the financial sector and economic growth of country.   Keywords: Petroleum consumption, financial development, non-renewable energy, Autoregressive Distributed Lag (ARDL), Toda-Yamamoto (TYDL) non Granger-causality test

scholarly journals Temporal Causality and Dynamics of Financial Development, Trade Openness, and Economic Growth in Vector Auto Regression (VAR) for Bangladesh, 1974-2003: Implication for Poverty Reduction

2007 ◽  
Vol 2 (1) ◽  
pp. 1-12 ◽  
Author(s):  
A.F.M. Kamrul Hassan ◽  
M. Rafiqul Islam
Keyword(s):  
Granger Causality ◽  
Financial Development ◽  
Poverty Reduction ◽  
Trade Openness ◽  
Mutual Effect ◽  
Granger Causality Test ◽  
Causal Link ◽  
Causality Test ◽  
Positive Role ◽  
Integration Test

This paper examines whether financial development and openness to international trade can play any positive role in reducing poverty in Bangladesh through their growth enhancing effect. The paper takes granted that growth reduce poverty and makes econometric test to ascertain whether financial development and trade openness cause growth. Standard Granger-causality test is employed for this purpose. Variables are found first difference stationary without having any co-integrating relationship as reported by Johansen co-integration test. As such Granger-causality test is carried out in first difference VAR. The paper does not find any causal relationship between trade openness and growth, and financial development and growth. This implies that financial development and trade openness do not reduce poverty through their effect on growth. However, bi-directional causal link evidenced between financial development and trade openness indicates that these two can contribute to poverty reduction directly through their mutual effect on each other. Journal of Nepalese Business Studies Vol.2(1) 2005 pp.1-12

scholarly journals Modelling Energy Consumption, Carbon Dioxide Emissions and Economic Growth Nexus in Ethiopia: Evidence from Cointegration and Causality Analysis

2018 ◽  
Vol 6 (6) ◽  
pp. 699 ◽  
Author(s):  
Shemelis Kebede Hundie
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Co2 Emissions ◽  
Financial Development ◽  
Environmental Sustainability ◽  
Carbon Dioxide Emissions ◽  
Positive Impact ◽  
Trade Openness ◽  
Causality Analysis ◽  
The Impact

Policy makers need to know the relationship among energy use, economic growth and environmental quality in order to formulate rigorous policy for economic growth and environmental sustainability. This study analyzes the nexus among energy consumption, affluence, financial development, trade openness, urbanization, population and CO2 emissions in Ethiopia using data from 1970–2014. The ARDL cointegration results show that cointegration exists among the variables. Energy consumption, population, trade openness and economic growth have positive impact on CO2 in the long-run while economic growth squared reduces CO2 emissions which confirms that the EKC hypothesis holds in Ethiopia. In the short-run urbanization and energy consumption intensify environmental degradation. Toda-Yamamoto granger causality results indicate the bi-directional causality between energy consumption and CO2 emissions, CO2 emissions and urbanization. Financial development, population and urbanization cause economic growth while economic growth causes CO2 emissions. Causality runs from energy consumption to financial development, urbanization and population which in turn cause economic growth. From the result, CO2 emissions extenuation policy in Ethiopia should focus on environmentally friendly growth, enhancing consumption of cleaner energy, incorporating the impact of population, urbanization, trade and financial development.

scholarly journals A Causal Nexus of Energy Consumption, Private Investment, Economic Growth and Environmental Degradation: Evidence from Pakistan

2020 ◽  
Vol 6 (2) ◽  
pp. 367-376
Author(s):  
Shabana Parveen ◽  
Hazrat Ali ◽  
Habib Elahi Sahibzada ◽  
Sohail Farooq
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Granger Causality ◽  
Co2 Emissions ◽  
Environmental Degradation ◽  
Private Investment ◽  
Granger Causality Test ◽  
Var Model ◽  
Causality Test ◽  
Policy Makers

The importance of private investment in the growth process of a country cannot be denied, however, its relationship with environmental degradation has not got much attention from researchers yet. The present study is an attempt to divert the attention of researchers and policy makers to the association with private investment and environmental degradation.  The time series data was used from 1975 to 2017. The data was taken from WDI. To analyze the causal link among environmental degradation, private investment, energy consumption and economic growth, Vector Autoregressive (VAR) model is used. Granger causality test is employed for knowing the course of causality in the variables. The results of the VAR model suggest that if an innovation of one standard deviation occurs from outside, it takes about 12 years for CO2 emissions, 9 years for private investment, 10 years for energy consumption and about 8years for economic growth to adjust. Moreover, the results show that most of the variation in all variables is explained by their own. Granger causality test identifies four unilateral causalities in the variables running from CO2 emissions to economic growth while the consumption of energy to CO2 emissions, energy consumption to economic growth while  from economic growth to private investment. The study recommends policy makers to make environmental friendly policies regarding consumption of energy, private investment and also economic growth.

Sign in / Sign up

Export Citation Format

Share Document