Testing the Export-Led Growth Hypothesis for Botswana: A Causality Analysis

AC Jordaan · Joel Hinaunye Eita

25 citations0/0 files storedBotswana Journal of Economics

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Global trade and economics Monetary Policy and Economic Impact Economic and Technological Innovation

Abstract

This paper investigates the causal relationship between export and economic growth for Botswana, using quarterly data for the period 1996 to 2007. The results show that there is bi-directional causality between export and economic growth. The two variables complement each other. This indicates that there is evidence in support of the export-led growth hypothesis as well as reverse causality. The results suggest that in order to achieve high economic growth, policies aimed at export expansion should be promoted. It is also necessary to devote resources on the non-export goods and services production in order to increase exports. The results suggest further, that Botswana can expand its limited domestic market by increasing exports. Keywords: Africa, Botswana, Exports, Granger Causality, Growth

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References

1987Co-Integration and Error Correction: Representation, Estimation, and Testing 1969Investigating Causal Relations by Econometric Models and Cross-spectral Methods 1980Macroeconomics and Reality 1995Statistical inference in vector autoregressions with possibly integrated processes 1986Market Structure and Foreign Trade 1988Some recent development in a concept of causality 1987Forecasting and testing in co-integrated systems 1995Using Cointegration Analysis in Econometric Modelling

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