Analysis of border trade impacts on economic growth of Yunnan and the Greater Mekong Sub-region (GMS) countries

Menglei Zhang (), Kunchon Wattanakul, Nisit Panthamit and Chukiat Chaiboonsri
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Menglei Zhang: Chiang Mai University
Kunchon Wattanakul: Chiang Mai University
Nisit Panthamit: Chiang Mai University
Chukiat Chaiboonsri: Chiang Mai University

The Empirical Econometrics and Quantitative Economics Letters, 2012, vol. 1, issue 2, 47-58

Abstract: The aim of this paper is to analyze the relationship between border trade and economic growth of Yunnan province, China and Greater Mekong Sub-region (GMS) Countries, which is represented by border import, border export and real GDP. We use annual data of Yunnan province and GMS countries from 1999 to 2010. This paper includes three steps: first, tests the panel unit root, second examines the panel co-integration and third investigates the Granger causality relationship among border export, border import and economic growth. There are four conclusions. First, the data of border import, border export and real GDP have a unit root at the level. Second, the time and entity fixed model is the best model to test the panel co-integration. Third, the border imports have long-run negative relationship with economic growth based on time and entity fixed effects model and the border export have long-run positive effects on economic growth based on entity fixed effects model. Last, the relationship between economic growth and border imports, which has only one-way granger causality relationship that means border imports effects on economic growth in long-run and short-run.

Keywords: GMS countries; panel data; border trade; economic growth (search for similar items in EconPapers)
JEL-codes: A11 B17 C63 (search for similar items in EconPapers)
Date: 2012
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