Causality Analysis on Export and Economic Growth Nexus in Ghana

Abstract

The study examined the causal relationship between export and economic growth based on monthly data for the period 2010 to 2019. Composite Index Economic Activity (CIEA) was used as a proxy for real GDP (economic growth). Time series econometric techniques were employed to explore long-run and short run relationships as well as the causality between them. The results revealed the existence of long-run relationships; evidence of bi-directional causality and a rapid adjustment to equilibrium between real GDP and exports. Recommendations are that, policy makers should focus on implementing export oriented policies and promote economic growth to achieve sustainable development.

Does causality exist between exports and economic development? Evidence from selected EU countries

“…Moreover, the investigation has confirmed the presence of a bidirectional link between variables in Denmark. This insight supports a feedback approach and the studies by Mah (2007), Sunde (2017), Guntukula (2018), Mensah andOkyere (2020), andAdebavo (2020). It is assumed, that the implementation of strategies to promote economic growth and exports could contribute to the achievement of sustainable development.…”

“…From the literature review mentioned above, the inter-linkage between exports and economic development has been and still are a subject of intensive debate amongst researchers and policymakers, with inconclusive outcomes being reached along the way. The findings of investigations have varied across the countries involved (Trošt & Bojnec, 2015;Ee, 2016;Dinc & Gokmen, 2019;Sultanuzzaman et al, 2019;Fannoun & Hassouneh, 2019;Mensah & Okyere, 2020). This research has shown that evidence exists in regard to a correlation between exports and economic development.…”

“…Methodology. The author has referred to a methodology, which has been applied by various researchers (Mah, 2007;Mishra, 2011;Tekin, 2012;Marwan el al., 2013;Gokmenoglu el al., 2015;Sunde, 2017;Mensah & Okyere, 2020). The research involves three steps, which are outlined below.…”

“…In the case of Nigeria, the study by Oumarou and Maiga (2019) detected a positive effect of trade upon development, while the effect of foreign direct investment on economic performance was negative. The investigation by Mensah and Okyere (2020) showed the presence of the bidirectional link between real GDP and exports in Ghana in the period from 2010 to 2019. The study by Marwan et al (2013) confirmed the neutral approach.…”

Export – economic growth nexus in the world regions: directions of public policy

“…The interrelationship between export and economic growth has been a subject of debate among the scientists for a long time (Smith, 1776;Feder, 1982;Fryges, 2009;Mishra, 2011;Wagner, 2012;Tekin, 2012;Abbas, 2012;Dritsaki, 2013;Saaed et al, 2015;Shafiullah et al, 2017;Guntukula, 2018;Sultanuzzaman et al, 2019;Mensah & Okyere, 2020;Adebayo, 2020). Scientific studies on the export-economic growth nexus provide controversial results.…”