PL EN


2016 | 12. Przedsiębiorczość jako czynnik rozwoju układów lokalnych | 149-162
Article title

Empirical Verification of Dynamic Dependences Between Productivity and Economy Openness. The Case of Visegrad Countries

Content
Title variants
Conference
Przedsiębiorczość jako czynnik rozwoju układów lokalnych
Languages of publication
EN
Abstracts
EN
This study analyses one of the main postulates of the Endogenous Growth Theory, that suggests that international trade openness is capable to speed up growth-impacting productivity. ADF stationary tests, Johansen co-integration test and Vector Error Correction Model (VECM) procedures are applied on a yearly data set covering the period 1995–2014. Data for individual V4 countries were also compared with EU-15 benchmark. The main finding of the paper is that for all V4 countries there exists a long term relationship between economy openness and labour productivity and in case of Hungarian economy in the Granger sense – causality is one-directional and runs only from productivity to openness. It suggest, that the Endogenous Growth Theory in this case is no longer supported nevertheless further and deeper investigation is needed. Although huge differences in case of openness between V4 countries exist, strong positive linear correlation with productivity is observed. Also disturbing secondary result of conducted research is that however convergence in case of productivity between V4 and EU-15 is observed, assuming the current rate of catching-up (apart from existence of saturation level of productivity), EU-15 and V4 average productivity would equal in 6 decades.
Contributors
  • Uniwersytet Pedagogiczny w Krakowie, Instytut Geografii, Zakład Przedsiębiorczości i Gospodarki Przestrzennej, Polska
References
  • Barro, R. J. (2001). Human Capital and Growth. American Economic Review, AEA P&P, 91(2), 12–17.
  • Barro, R.J., Sala-i-Martin, X. (2004). Economic Growth, (2nd ed.). New York: McGraw-Hill.
  • Cameron, G., Proudman, J., Redding, S. (1998). Productivity Growth in an Open Economy. Bank of England Working Paper, New College, Oxford.
  • Dickey, D. A., Fuller, W. A. (1979). Distribution of the Estimators for Autoregressive Time Series with a Unit Root. Journal of the American Statistical Association, 74(366), 427–431.
  • Edwards, S. (1998). Openness, Productivity and Growth: What Do We Really Know?. Economic Journal, 108, 383–398.
  • Engle, R.F., Granger, C.W.J. (1987). Cointegration and Error Correction: Representation, Estimation and Testing. Econometrica, 55(2).
  • Easterly, W., Levine, R. (2001). It’s not Factor Accumulation: Stylized Facts and Growth Models. The World Bank Economic Review,15(2).
  • Frankel, J. and Romer D. (1999). Does Trade Cause Growth?. The American Economic Review, 89(3), 379–399.
  • Gonzalez, G., Constantin, S. (2009). Explaining TFP Growth Rates: Dissimilar Effect of Openness between Different Income Groups of Countries. MPRA Paper, 17584.
  • Granger, C.W.J. (1969). Investigating Casual Relations by Econometric Models and Cross-Spectral Methods. Econometrica, 37.
  • Granger, C.W.J. (1983). Co-integrated Variables and Error-Correcting Models. University of California (San Diego), Discussion Paper, 83–13a.
  • Gunes, S., Kose, S. (2013). Does Openness Increase Productivity? Evidence from an Emerging Economy: Turkey. International Journal of Humanities and Social Science, 3(5), 72–77.
  • Gurgul, H., Lach, Ł. (2009). Związki przyczynowe pomiędzy bezpośrednimi inwestycjami zagranicznymi w Polsce a podstawowymi wskaźnikami makroekonomicznymi. Ekonomia Menedżerska, 6, 77–91.
  • Herzer, D. (2005). Does Trade Increase Total Factor Productivity: Cointegration Evidence for Chile.
  • Ibero America Institute for Econ. Research (IAI) Discussion Papers,115, Ibero-America Institute for Economic Research.
  • Johansen, S. (1988). Statistical Analysis of Cointegration Vectors. Journal of Economic Dynamics and Control, 12.
  • Johansen, S., Juselius, K. (1990). Maximum Likelihood Estimation and Inference on Cointegration – with Applications to the Demand for Money. Oxford Bulletin of Economics and Statistics, 52(2), 169–210.
  • Krugman, Paul (2013, 18 August). The New Growth Fizzle. New York Times. Retrieved from: http:// krugman.blogs.nytimes.com/2013/08/18/the-new-growth-fizzle/?_r=1
  • Kumar, S., Pacheco, G., Rossouw, S. (2010). How to Increase the Growth Rate in South Africa. MPRA Paper, 26105.
  • Kusideł, E. (2000). Modele wektorowo-autoregresyjne VAR. Metodologia i zastosowania. In: B. Suchecki (eds.), Dane panelowe i modelowanie wielowymiarowe w badaniach ekonomicznych, Łódź, Wyd.Absolwent.
  • Kwiatkowski, D., Phillips, P. C. B., Schmidt, P., Shin, Y. (1992). Testing the Null Hypothesis of Stationarity against the Alternative of a Unit Root. Journal of Econometrics, 54, 159–178.
  • Lee, D. (2007). Determinants of Chinese TFP: National and Regional Level. School of Economics, Yonsei University, Seoul, Korea.
  • Lucas, R.E. (1988). On the mechanics of Economic Development. Journal of Monetary Economics, 22.
  • Machek, O. (2012). Data Issues in Total Factor Productivity Benchmarking: A Central European Perspective. The Annals of the University of Oradea. Economic Sciences, 21(2).
  • Parente, S. (2001). The Failure of Endogenous Growth. Knowledge. Technology & Policy, 13(4), 49–58. DOI:10.1007/BF02693989 Rebelo, S. (1991).
  • Long-Run Policy Analysis and Long-Run Growth. Journal of Political Economy, 99(3), 500.
  • Romer, P. M. (1994). The Origins of Endogenous Growth. The Journal of Economic Perspectives, 8(1), 3–22.
  • Sachs, J., Warner, D., Andrew, M. (1997). Fundamental Sources of Long-Run Growth. American Economic Review, 87(2), 184–188.
  • Saha, S. (2012). Productivity and Openness in Indian Economy. Journal of Applied Economics and Business Research, 2(2), 91–102.
  • Tsen, W.H. (2006). Granger causality tests among openness to international trade, human capital accumulation and economic growth in China: 1952–1999. International Economic Journal, Taylor & Francis Journals, 20(3), 285–302.
  • Wach, K., Wojciechowski L. (2014). The Factors of Outward FDI from V4 Countries From The Perspective of EU and EMU Membership: A Panel Gravity Model Approach. Acta Universitatis Lodziensis Folia Oeconomica, 5(307), 157–170.
  • Xu, H., Lai, M., Qi, P. (2008). Openness, Human Capital and Total Factor Productivity: Evidence from China. Journal of Chinese Economic and Business Studies, 63, 279–289.
  • Yan, I.K., Chong T.T., Kwok W.H. (2007). Openness and Productivity in China. http://cerdi.org/uploads/ sfCmsContent/html/203/Chong.pdf
  • Yanikkaya, H. (2003). Trade Openness and Economic Growth: A Cross-Country Empirical Investigation. Journal of Development Economics, 72(1), 57–89.
Document Type
Publication order reference
Identifiers
YADDA identifier
bwmeta1.element.desklight-029a5e16-8a44-4906-a270-919caa5eeb7e
JavaScript is turned off in your web browser. Turn it on to take full advantage of this site, then refresh the page.