Exports and Economic Growth: Theories and Evidence from Eastern and Southern Africa

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Most of the previous empirical studies that tested• the link between exports 'and economic growth focused on cross country regression analysis. This approach, however, suffers from an over simplified assumption of uniform production functions across Countries which obscure intercountry differences; these studies use period averages which are misleading if the time series are non-stationary and it is difficult to associate the results obtained with any particular country in the group. In trying to deal with these weaknesses this study has employed individual country time series data to test the relationship between exports and GDP growth as well as to establish the direction of causality between them. Our time series results reveal a positive and significant association between exports and growth in four out of the seven countries investigated, and in three of these countries causality has been found to run form exports to growth.



Exports and Economic Growth, Eastern and Southern Africa