scholarly journals How do Globalization, Technological Change and Employment Impact Economic Growth in Developing Countries? Evidence from Panel Data Analysis

2018 ◽  
Vol 1 (1) ◽  
pp. 39-49
Author(s):  
Fatima Saleem ◽  
Fatima Farooq ◽  
Imran Sharif Chaudhry ◽  
Noreen Safdar
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Developing Economies ◽  
Panel Data Analysis ◽  
Trade Openness ◽  
Causality Analysis ◽  
Causality Test ◽  
Panel Ardl ◽  
Long Run ◽  
The Impact

This study aims at exploring the impact of globalization, technology and employment on economic growth of developing economies. This study also observed the long-run, short-run and causality relationships between globalization, technological innovations, employment, and economic growth for 20 selected developing countries covering the data for period of 1991 to 2017.  Since stationary of variables is examined through ADF tests, Levin-Lin-Chu test, and IM-Pesaran-Shin test and resulted with mixed order of integration, Panel ARDL estimation techniques are employed to measure the long run effects of these variables on growth of selected economies. Dumitrescu-Hurlin panel Granger Causality test was applied for causality analysis. All variables have strong positive and significant relationship with growth. This study concluded that knowledge and research-based education have a key role in promoting long-run growth as evident from the ‘New growth theory’ of Romer. On the basis of these results, it is suggested that knowledge and research-based education should be promoted and export-oriented policies should also be encouraged to attain benefits of trade openness and globalization for accelerating economic growth on sustainable basis.

scholarly journals R&D Expenditure R&D Expenditure as an Accelerator of Economic Growth with Special Reference to Developing Countries

2021 ◽  
Vol 7 (3) ◽  
Author(s):  
Tariq Mahmood Ali ◽  
Adiqa Kausar Kiani ◽  
Tariq Bashir ◽  
Talah Numan Khan
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Developing Economies ◽  
Positive Association ◽  
Estimation Model ◽  
Panel Ardl ◽  
Long Run ◽  
Short Run ◽  
The Impact ◽  
D Investment

Purpose: In this network age, among the other factors which increase economic growth, the R&D activities, a pivotal and effective factor, carried out by a country. The present study attempts to investigate the empirical R&D expenditure-economic growth nexus in developing and developed economies, and also provides useful insight about how R&D investment works to enhance the economic growth of a country. Design/Methodology/Approach: In this regard, 21 years data of top 100 economies of the world from 1995 to 2015 has been utilized. The Panel ARD Model approach has been preferred to explore the impact of R&D investment on economic growth (GDP). For construction of the estimation model, five different variables are used. In order to accomplish the results, along with analysing the data of 100 countries a whole, analysis has also been made by dividing countries into different categories and groups. Overall, the Panel ARDL test has been performed on nine different groups of countries. Findings: The results reveal that, ceteris paribus, there is a strong positive association between R&D expenditure and economic growth (GDP) in the long-run; 1% increase in GERD leads to 0.07% increase in GDP. However, the impact in the developing countries (0.043%) is lower compared to the developed OECD countries (0.27%). No impact of the R&D expenditure on economic growth is observed in the short-run. Implications/Originality/Value: The study presents some thought-provoking ideas, policy recommendations and implications for the policy makers, planners and researchers, especially in the context of developing economies.  

scholarly journals Renewable Energy Development as a Driver of Economic Growth: Evidence from Multivariate Panel Data Analysis

2019 ◽  
Vol 11 (8) ◽  
pp. 2418 ◽  
Author(s):  
Nadia Singh ◽  
Richard Nyuur ◽  
Ben Richmond
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Renewable Energy ◽  
Energy Production ◽  
Developing Economies ◽  
Panel Data Analysis ◽  
Least Square ◽  
Renewable Energy Production ◽  
The Future ◽  
The Impact

Renewable energy is being increasingly touted as the “fuel of the future,” which will help to reconcile the prerogatives of high economic growth and an economically friendly development trajectory. This paper seeks to examine relationships between renewable energy production and economic growth and the differential impact on both developed and developing economies. We employed the Fully Modified Ordinary Least Square (FMOLS) regression model to a sample of 20 developed and developing countries for the period 1995–2016. Our key empirical findings reveal that renewable energy production is associated with a positive and statistically significant impact on economic growth in both developed and developing countries for the period 1995–2016. Our results also show that the impact of renewable energy production on economic growth is higher in developing economies, as compared to developed economies. In developed countries, an increase in renewable energy production leads to a 0.07 per cent rise in output, compared to only 0.05 per cent rise in output for developing countries. These findings have important implications for policymakers and reveal that renewable energy production can offer an environmentally sustainable means of economic growth in the future.

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 The Impact of FDI on Economic Growth in Case of Romania

2020 ◽  
Vol 12 (12) ◽  
pp. 81
Author(s):  
Alina Mihaela Ciobanu
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Labor Force ◽  
Direct Investment ◽  
Trade Openness ◽  
Causality Test ◽  
Long Run ◽  
Main Determinants ◽  
The Impact ◽  
Determinants Of Economic Growth

Foreign direct investment flows had increased worldwide over the last decades and many specialists think that there is a strong correlation among trade, FDI, labor force, and economic growth in the receiving countries. Based on available statistical data, we will examine the effects of FDI on GDP growth and the causality relations between GDP, trade openness, labor force, and FDI in case of Romania for the last decades. The ARDL bound testing approach is used to study the existence of a long-run relationship between FDI, trade, labor, and economic growth. Then the error-correction based Granger causality test is used to test the direction of causality between the variables. The results revealed that there is cointegration among the variables when real GDP and foreign direct investment are the dependent variables. Foreign direct investment, trade openness, and labor force are the main determinants of economic growth in the long run in Romania. In addition, the increase of gross domestic product, exports, imports and labor force promote foreign direct investment in the long run.

scholarly journals Impact of Capital Inflows on Economic Growth of Developing Countries

2015 ◽  
Vol 1 (7) ◽  
pp. 7-21
Author(s):  
Chigbu Ezeji E ◽  
Ubah Chijindu Promise ◽  
Chigbu Uzoamaka S
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Developing Economies ◽  
Positive Impact ◽  
Unit Root Test ◽  
Least Square Method ◽  
Least Square ◽  
Capital Inflows ◽  
Long Run ◽  
The Impact

This study examines the impact of capital inflows on economic growth of developing economies; the case of Nigeria, Ghana and India from 1986-2012. This is necessitated by the doubts being raised as whether the huge inflows of foreign capital in developing economies over the years have transmitted to real economic growth. Augmented Dickey Fuller unit root test was employed to evaluate the stationarity of the data, while Johansen Co-integration was used to estimate the long-run equilibrium relationship among the variables. The casual relationship was tested using Granger Causality, and Ordinary Least Square method was used to estimate the model. The findings reveals that capital inflows have significant impact on the economic growth of the three countries. In Nigeria and Ghana, foreign direct and portfolio investment as well as foreign borrowings have significant and positive impact on economic growth. Workers’ remittances significantly and positively related to the economic growth of the three countries. The enabling environment should be created in the developing countries to encourage more inflow of foreign investments and workers remittances. This will help in closing the savings-investment gap and encourage economic growth in these countries. The study signifies that capital inflows is indispensable in closing the savings-investment gap required for economic growth of developing countries.

scholarly journals Urban population and economic growth: South Asia perspective

2016 ◽  
Vol 5 (1) ◽  
pp. 64 ◽  
Author(s):  
Sandip Sarker ◽  
Arifuzzaman Khan ◽  
Mehdad Mamur Mannan
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
South Asia ◽  
Urban Population ◽  
Panel Data Analysis ◽  
Trade Openness ◽  
Unit Root Test ◽  
Long Run ◽  
Augmented Dickey Fuller ◽  
Determinants Of Economic Growth

Previously economic growth was generally discussed in terms of foreign direct investment (FDI), educational growth, savings, investments, inflation as well as trade openness of a nation. Very recently it has been identified that population is one of the major determinants of economic growth of a nation. In the recent years, the study of urbanization has gained a matter of concern in developing countries as it has been recognized as part of a larger process of economic development which is affecting developing countries. South Asian countries are one of the emerging economics and growing at a faster rate over the past few years. At the same time, population of South Asia is growing at a significant rate. Therefore the study has attempted to identify the causal relationship between urban population and economic growth in South Asia using a panel data analysis. The study makes use of the Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP), Pesaran as well as Fisher methods for panel unit root test. The panel Pedroni cointegration test suggests that there is long run relationship between the variables. The further panel Vector Error Correction Model (VECM) suggests that there is long run causality running from urban population growth to economic growth in South Asia. The study concludes that the growth of urban population can have significant impact on economic growth in South Asia in the long run.

Is Fiscal Deficit Essential for Stimulating Economic Growth in Developing Economies? Theory and Empirical Evidence from India

2021 ◽  
Keyword(s):  
Economic Growth ◽  
Developing Economies ◽  
Negative Impact ◽  
Gdp Growth ◽  
Fiscal Deficit ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
The Government ◽  
The Impact

The primary purpose of this paper was to assess the impact of fiscal deficit on the economic growth of the Indian economy and find out the causality between fiscal deficit and economic growth from 1981-82 to 2019-20. To analyse the long-run relationship between the variables Johansen Co-integration test was used; after verifying the existence of long-run relationship among variables, the Vector Error Correction Model (VECM) was used, and the Granger Causality test was also used for investigating the direction of causality between pair of variables. The findings of the study supported the ideology of classical economists in which they neglected the government intervention for the growth and development of an economy. The results showed that in long run, fiscal deficit had a significant negative impact on economic growth as one percent increase in fiscal deficit demoted the GDP growth rate by 0.075 percent, whereas in the short run, the impact was also found negative, but it was significant only one lag. Simultaneously, there was unidirectional causality found from fiscal deficit to GDP growth.

Trade openness and economic growth in the Asian region

2014 ◽  
Vol 7 (3) ◽  
pp. 136-152 ◽  
Author(s):  
Muhammad Tahir ◽  
Imran Khan
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Least Squares Method ◽  
Trade Openness ◽  
Domestic Investment ◽  
Content Type ◽  
Asian Region ◽  
Long Run ◽  
The Impact ◽  
Determinants Of Economic Growth

Purpose – This paper aims to focus on the Asian developing countries to examine the impact of trade openness on economic growth. Design/methodology/approach – Empirical analysis is carried out with the help of panel econometric techniques and two-stages least squares method. Findings – The results show that trade openness has contributed significantly to the growth process of the developing countries located in the Asian region. It is also found that domestic investment has influenced economic growth for the sampled countries. Further, the results show that human capital has adversely affected economic growth despite the fact that different proxy variables are used. Research limitations/implications – No positive relationship between education and economic growth could be established despite using different measures of education. However, this issue has been brought to the attention of researchers for further investigation. Practical implications – Developing countries located in the Asian region, therefore, are suggested to speed up the process of trade liberalization and also pay favourable attention to other determinants of economic growth to accelerate long-run economic growth. Originality/value – The results presented in the paper are original. Some insights about the impact of education on economic growth have been highlighted.

scholarly journals Impact of FDI and Electricity on the Economic Growth of Pakistan: A Long Run Cointegration and Causality Analysis

2021 ◽  
Vol 12 (2) ◽  
pp. 273
Author(s):  
Umer Qazi ◽  
Aftab Alam ◽  
Shahab Ahmad ◽  
Rani Ambreen
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Direct Investment ◽  
Electricity Consumption ◽  
Causality Analysis ◽  
Bounds Testing ◽  
Long Run ◽  
Ardl Bounds Testing ◽  
Short Run ◽  
The Impact

Since the 1980s, analysts have been debating the effect of foreign direct investment (FDI) and electricity consumption (EC) on the economic growth (GDP) of developing countries. The purpose of the study is to estimate the long-run relationship between FDI, electricity consumption and GDP of Pakistan for the period of 1971 to 2017, using ARDL bounds testing, FMOLS and Canonicals cointegration regression. For causality analysis, the study uses a VECM approach for short-run causality directions and MWALD/Toda Yamamoto approach for the long-run causality directions. The cointegration results of all the approaches state that there exists a positive and significant long-run relationship between the concerned variables. The impact of electricity consumption on economic growth is very strong as compared to FDI. Moreover, in the short-run, there is a unidirectional causality running from FDI to GDP and GDP to EC. In the long-run causality, the study finds unidirectional causality for FDI and bidirectional causality for EC with GDP.

The relationship between international trade openness and economic growth in the developing economies

2015 ◽  
Vol 8 (2) ◽  
pp. 123-139 ◽  
Author(s):  
Muhammad Tahir ◽  
Toseef Azid
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Developing Economies ◽  
Labour Force ◽  
Trade Openness ◽  
Content Type ◽  
Long Run ◽  
Speed Up ◽  
Determinants Of Economic Growth ◽  
The Relationship

Purpose – This paper aims to establish a relationship between trade openness and economic growth in the context of the developing countries. This study has proposed a new measure of trade openness to the literature, as the available measures are flawed. Design/methodology/approach – Empirical analyses are carried out with the help of panel econometric techniques. Findings – The main finding of the paper is that the relationship between trade openness and economic growth is positive and statistically significant for developing countries. Besides trade openness, other determinants of economic growth such as investment and labour force are also significantly related with economic growth and carry expected coefficients. Further, it is found that frequent fluctuations in prices are detrimental to long-run economic growth. Practical implications – Therefore, the developing countries are suggested to speed up the process of trade liberalization and also pay favourable attention to other determinants of economic growth to achieve high economic growth. Originality/value – The authors have used a new measure of trade openness apart from the conventional trade volume measure of trade openness.

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