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    Impact of trade openness on output growth: co integration and error correction model approach

    Access Status
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    Authors
    Arif, A.
    Ahmad, Hasnat
    Date
    2012
    Type
    Journal Article
    
    Metadata
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    Citation
    Arif, Asma and Ahmad, Hasnat. 2012. Impact of trade openness on output growth: co integration and error correction model approach. International Journal of Economics and Financial Issues 2 (4): pp. 379-385.
    Source Title
    International Journal of Economics and Financial Issues
    Additional URLs
    http://www.econjournals.com/index.php/ijefi/article/view/277/pdf
    ISSN
    2146-4138
    URI
    http://hdl.handle.net/20.500.11937/37187
    Collection
    • Curtin Research Publications
    Abstract

    This study analyzed the long run relationship between trade openness and output growth for Pakistan using annual time series data for 1972-2010. This study follows the Engle and Granger co integration analysis and error correction approach to analyze the long run relationship between the two variables. The Error Correction Term (ECT) for output growth and trade openness is significant at 5% level of significance and indicates a positive long run relation between the variables. This study has also analyzed the causality between trade openness and output growth by using granger causality test. The results of granger causality show that there is a bi-directional significant relationship between trade openness and economic growth.

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