Economics Research Institute Study Paper
Utah State University Department of Economics
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In this paper we have investigated the causal relationship between exports and growth in a bivariate framework using time-series data on six countries. Hsiao's (1979, 1981) version of the Granger causality test is used to find the direction of causation. Our study improves upon previous work by evaluating the time series properties of GDP and exports and supplementing Granger causality tests with a bivariate cointegration te~t and error-correction model. Our fmdings suggest that the evidence in favor of export-promotion policy is weaker than previous statistical studies have indicated.
Fawson, Chris and Chang, Tsangyao, "Cointegration, Causality, Error-Correction, and Export-Led growth in six countries: Japan, Philippines, South Korea, Taiwan, United Kingdom and United States" (1994). Economic Research Institute Study Papers. Paper 39.