Export-led growth: a survey of the empirical literature and some non-causality results. Part 2

A. Giles, Cara L. Williams, Judith

Journal of International Trade & Economic Development, 2000, vol. 9, issue 4, pages 445-470

Abstract: This paper continues the investigation of Giles and Williams (2000) on export-led growth (ELG). In the first part, we surveyed the empirical export-led growth literature; it was evident that Granger non-causality tests are commonly applied as a test for ELG. In this paper, we explore the sensitivity of the test for exclusions restrictions often used as the Granger non-causality test for ELG by reconsidering two applications: Oxley's (1993) study for Portugal and Henriques and Sadorsky's (1996) analysis for Canada. We focus on the robustness of the method adopted to deal with non-stationarity, including the choice of deterministic trend degree. We show that different noncausality outcomes are easy to obtain, and consequently we recommend that readers interpret the empirical ELG literature with care. Our analysis also highlights the importance of examining the robustness of Granger non-causality test results to avoid spurious outcomes in applications.

Keywords: Economic Growth Causality Time Series Models Robustness Misspecification Model Dimension Cointegration (search for similar items in EconPapers)
Date: 2000
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