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Impact of Trade Openness on Output Growth: Co integration and Error Correction Model Approach

Citation

Arif, A and Ahmad, H, Impact of Trade Openness on Output Growth: Co integration and Error Correction Model Approach, International Journal of Economics and Financial Issues, 2, (4) pp. 379-385. ISSN 2146-4138 (2012) [Refereed Article]


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Copyright 2012 The Authors Licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) https://creativecommons.org/licenses/by/4.0/

Official URL: http://www.econjournals.com/index.php/ijefi/articl...

Abstract

This study analyzed the long run relationship between trade openness and output growth for Pakistan using annual time series data for 1972-2010. This study follows the Engle and Granger co integration analysis and error correction approach to analyze the long run relationship between the two variables. The Error Correction Term (ECT) for output growth and trade openness is significant at 5% level of significance and indicates a positive long run relation between the variables. This study has also analyzed the causality between trade openness and output growth by using granger causality test. The results of granger causality show that there is a bi-directional significant relationship between trade openness and economic growth.

Item Details

Item Type:Refereed Article
Keywords:Trade openness, output growth, cointegration, error correction model
Research Division:Economics
Research Group:Applied Economics
Research Field:Economic Development and Growth
Objective Division:Economic Framework
Objective Group:Macroeconomics
Objective Field:Economic Growth
Author:Ahmad, H (Mr Hasnat Ahmad)
ID Code:111762
Year Published:2012
Deposited By:Menzies Institute for Medical Research
Deposited On:2016-10-05
Last Modified:2016-11-11
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