Services and economic growth in Pacific Island countries

Azmat Gani and Michael D. Clemes

International Journal of Development Issues, 2010, vol. 9, issue 2, 113-130

Abstract: Purpose - The purpose of this paper is to present an empirical study of the contribution of the services sector to per capita economic growth for Pacific Island countries. Design/methodology/approach - Within the new growth theory framework, the empirical procedure consisted of the regression analysis of data using the panel data fixed effects procedure. Findings - The results confirm the positive and statistically significant correlation of services growth to per capita gross domestic product growth. Research limitations/implications - Limitations largely centre on the use of aggregate cross‐country data. Variations may be found in what actually drives the services growth at the country level. Thus, a country‐specific study would be more appropriate in order to get more robust results. Also, the data do not capture the effect of non‐market services. Disaggregate services data that separate market data services with non‐market services would provide a more accurate picture of the influence of non‐market services. Practical implications - The practical implication is that that service sectors in the Pacific Island countries ought to be given greater support, for example, investment in physical and institutional infrastructure, market access, financial support, skill development and investment incentives. Social implications - Pacific Islands services sectors contribute to household welfare through paid employment and meet household demands of service sector output. Originality/value - This paper presents the first study among the Pacific Island countries that has examined the importance of services sector and its contribution to growth. The findings of this study are useful to Pacific policy makers in terms of improving the services sector through instituting appropriate growth enhancing policies.

Keywords: Economic growth; Services; Fiji; Papua New Guinea; Tonga; Vanuatu (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:ijdipp:v:9:y:2010:i:2:p:113-130

DOI: 10.1108/14468951011062327

Access Statistics for this article

International Journal of Development Issues is currently edited by Dr Dilip Dutta

More articles in International Journal of Development Issues from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().