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Drivers of Growth in Fast Emerging Economies: A Dynamic Instrumental Quantile Approach

Simplice Asongu

No 15/009, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: This study complements the scarce literature on growth determinants in fast emerging economies of the BRICS and MINT by assessing the determinants throughout the conditional distributions of the growth rate and real GDP output for the period 2001-2011. An instrumenal variable (IV) quantile regression approach is complemented with Two-Stage-Least Squares and IV Least Absolute Deviations. The instrumentation process is dynamic. The following findings are established. First, while Gross FDI has a negative effect on economic growth, the impact of Net FDI is positive, with a higher magnitude in top quantiles of the distributions. Second, the positive effect of natural resources is more apparent in countries with low initial growth levels. Third, the impact of telecommunications infrastructure is not very significant. Fourth, whereas the incidence of bank credit is positive for GDP growth, it is negative for real GDP output. Fifth, while trade openness is positive in bottom quantiles of GDP growth, but for the highest quantile in real GDP output, it is consistently negative on real GDP output. Sixth, while the incidence of political stability is negative on GDP growth, it is positive on real GDP output, with the negative (positive) effect apparent only in top (bottom) quantiles of GDP growth (real GDP output). Policy implications are discussed.

Keywords: Economic Growth; Emerging countries; Quantile regression (search for similar items in EconPapers)
JEL-codes: C52 F21 F23 O40 O50 (search for similar items in EconPapers)
Pages: 20
Date: 2015-04
New Economics Papers: this item is included in nep-fdg and nep-gro
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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http://www.afridev.org/RePEc/agd/agd-wpaper/Driver ... uantile-approach.pdf Revised version, 2015 (application/pdf)

Related works:
Working Paper: Drivers of Growth in Fast Emerging Economies: A Dynamic Instrumental Quantile Approach (2015) Downloads
Working Paper: Drivers of Growth in Fast Emerging Economies: A Dynamic Instrumental Quantile Approach (2015) Downloads
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