Economic progress in emerging countries: the roles of diversification of import and export products and energy consumption

Muhlis Can (), Zahoor Ahmed (), Mahmood Ahmad () and Ihsan Oluc ()
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Muhlis Can: Social Science Research Lab (SSR LAB)
Zahoor Ahmed: New Uzbekistan University
Mahmood Ahmad: Shandong University of Technology
Ihsan Oluc: Mehmet Akif Ersoy University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2024, vol. 26, issue 7, No 74, 18207-18229

Abstract: Abstract Scholars have given enormous attention to the roles of energy use and trade in economic growth strategies; however, recent international trade literature suggests that not merely the volume of trade but the diversification of goods may have a potential effect on economic growth. Thus, this paper uses the diversification of export goods and diversification of import goods as explanatory variables along with energy consumption and assessed the role of these important variables in economic development. The empirical results from Westerlund's (J Appl Econom 23:193–233, 2008) and Westerlund's (Oxf Bull Econ Stat 69:709–748, 2007) tests disclosed the existence of cointegration. The long-run estimations obtained from the CUP-FM technique revealed that both import and export product diversifications positively influence economic growth. This presents a vital opportunity for emerging nations to expand growth by diversifying export and import products. Likewise, energy use, labor, and capital contribute to increasing economic growth. The estimates from the causality test illustrated bidirectional causality between export diversification and economic growth and unidirectional causality from energy to export diversification. Finally, policy suggestions to expand economic progress are discussed.

Keywords: Economic growth; Import products diversification; Energy consumption; Export products diversification (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10668-023-03386-8

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