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Year 2023, Volume: 12 Issue: 2, 83 - 90, 30.07.2023
https://doi.org/10.17261/Pressacademia.2023.1740

Abstract

References

  • Akıncı, G. Y., Akıncı, M., & Yılmaz, Ö. (2014). Determinants of financial development: a VAR Model for Turkey. International Journal of Alanya Faculty of Business, 6(1), 1-15.
  • Arodoye, N. L., & Iyoha, M. A. (2014). Foreign trade-economic growth nexus: evidence from Nigeria. CBN Journal of Applied Statistics, 5(1), 121-141.
  • Dickey, D. A. and Fuller, W. A. (1981). Likelihood ratio statistics for autoregressive time series with a unit root. Econometrica, 49(4), 1057-1072.
  • Girma, H. (2015). The impact of foreign aid on economic growth: Empirical evidence from Ethiopia (1974-2011) using ARDL approach. Journal of Research in Economics and International Finance, 4(1), 1-12.
  • Hassan , S. M., & Mohamed, M. J. (2022). Comparison of Somalia and the East Africa Community in terms of economy and competition. Daha International University Academic Journal (DIUAJ), 1(1), 1–10.
  • Hassan, S. M. (2022). A causal analysis on foreign trade and economic growth: the case of Somalia. (2022). International Journal of Scientific Research and Management (IJSRM), 10(08), 3725-3731.
  • Kumari, D., & Malhotra, N. (2014). Trade-led growth in India and China: A comparative analysis. Journal of International and Global Economic Studies, 7(2), 68-88.
  • Li, Z., & Yang, D. (2015, March). The study on the ınfluence of fixed asset ınvestment and foreign trade to the economic growth of ningbo---based on VAR Model. In 2015 International Conference on Education Technology, Management and Humanities Science (ETMHS 2015) (pp. 341-345). Atlantis Press.
  • lin Guan, J., & Hong, Y. (2012). An empirical analysis on US foreign trade and economic growth. Aasri Procedia, 2, 39-43.
  • Pradhan, R. P. (2009). The nexus between financial development and economic growth in India: Evidence from multivariate VAR model. International Journal of Research and Reviews in Applied Sciences, 1(2), 68-79.
  • Radford, J. P. (1990). [Review of Cities and Economic Development: From the Dawn of History to the Present, by P. Bairoch & C. Braider]. Geographical Review, 80(3), 336–338.
  • Raza, M., & Ying, X. Z. (2017). The causal relationship between export and economic growth of Pakistan. International Journal of Economics, Commerce and Management, 5(2), 210-230.
  • Shaikh, F. M. (2010, August). Causality relationship between foreign direct investment, trade and economic growth in Pakistan. In International Conference on Applied Economics ICOAE (Vol.2010, pp. 717-722).
  • Tadesse, T. (2011). Foreign aid and economic growth in Ethiopia: A cointegration analysis. The Economic Research Guardian, 1(2), 88-108.
  • Van Den Berg, H. (1997). The relationship between international trade and economic growth in Mexico. The North American Journal of Economics and Finance, 8(1), 1-21

ANALYZING THE NEXUS BETWEEN FOREIGN TRADE AND ECONOMIC GROWTH IN DJIBOUTI THROUGH THE APPLICATION OF A VAR MODEL (1989-2021)

Year 2023, Volume: 12 Issue: 2, 83 - 90, 30.07.2023
https://doi.org/10.17261/Pressacademia.2023.1740

Abstract

Purpose- Economic growth and foreign trade are among the most important macroeconomic objectives of all countries in the world. The concept of foreign trade is considered as the engine of economic growth, consisting of imports and exports. Therefore, countries engage in commercial relations with other countries through economic policies tailored to their own economic and political situations. Since there are few studies on the economy of Djibouti, this study investigates the Djiboutian economy using the variables of growth, imports, and exports. The study aims to identify the degree to which foreign trade has affected economic growth in Djibouti, as well as to analyze the short-term and long-term dynamics of this relationship.
Methodology-This study employs a Vector Autoregression (VAR) model to investigate the nexus between foreign trade and economic growth in Djibouti over the period of 1989-2021. The data used in this study is sourced from the Organisation of Islamic Cooperation (OIC) database, which provides extensive information on Djibouti's foreign trade and economic indicators.
Findings- The findings indicate that foreign trade has a strong positive impact on economic growth in Djibouti, underscoring the critical role of foreign trade in driving the country's economic performance.
Conclusion-This study is significant as it adds to the limited literature on the relationship between foreign trade and economic growth in Djibouti, offering policymakers and stakeholders valuable insights into the significance of foreign trade in promoting economic development in the country. These results could guide the development and implementation of policies aimed at promoting and sustaining foreign trade, leading to further growth and development of the Djiboutian economy.

References

  • Akıncı, G. Y., Akıncı, M., & Yılmaz, Ö. (2014). Determinants of financial development: a VAR Model for Turkey. International Journal of Alanya Faculty of Business, 6(1), 1-15.
  • Arodoye, N. L., & Iyoha, M. A. (2014). Foreign trade-economic growth nexus: evidence from Nigeria. CBN Journal of Applied Statistics, 5(1), 121-141.
  • Dickey, D. A. and Fuller, W. A. (1981). Likelihood ratio statistics for autoregressive time series with a unit root. Econometrica, 49(4), 1057-1072.
  • Girma, H. (2015). The impact of foreign aid on economic growth: Empirical evidence from Ethiopia (1974-2011) using ARDL approach. Journal of Research in Economics and International Finance, 4(1), 1-12.
  • Hassan , S. M., & Mohamed, M. J. (2022). Comparison of Somalia and the East Africa Community in terms of economy and competition. Daha International University Academic Journal (DIUAJ), 1(1), 1–10.
  • Hassan, S. M. (2022). A causal analysis on foreign trade and economic growth: the case of Somalia. (2022). International Journal of Scientific Research and Management (IJSRM), 10(08), 3725-3731.
  • Kumari, D., & Malhotra, N. (2014). Trade-led growth in India and China: A comparative analysis. Journal of International and Global Economic Studies, 7(2), 68-88.
  • Li, Z., & Yang, D. (2015, March). The study on the ınfluence of fixed asset ınvestment and foreign trade to the economic growth of ningbo---based on VAR Model. In 2015 International Conference on Education Technology, Management and Humanities Science (ETMHS 2015) (pp. 341-345). Atlantis Press.
  • lin Guan, J., & Hong, Y. (2012). An empirical analysis on US foreign trade and economic growth. Aasri Procedia, 2, 39-43.
  • Pradhan, R. P. (2009). The nexus between financial development and economic growth in India: Evidence from multivariate VAR model. International Journal of Research and Reviews in Applied Sciences, 1(2), 68-79.
  • Radford, J. P. (1990). [Review of Cities and Economic Development: From the Dawn of History to the Present, by P. Bairoch & C. Braider]. Geographical Review, 80(3), 336–338.
  • Raza, M., & Ying, X. Z. (2017). The causal relationship between export and economic growth of Pakistan. International Journal of Economics, Commerce and Management, 5(2), 210-230.
  • Shaikh, F. M. (2010, August). Causality relationship between foreign direct investment, trade and economic growth in Pakistan. In International Conference on Applied Economics ICOAE (Vol.2010, pp. 717-722).
  • Tadesse, T. (2011). Foreign aid and economic growth in Ethiopia: A cointegration analysis. The Economic Research Guardian, 1(2), 88-108.
  • Van Den Berg, H. (1997). The relationship between international trade and economic growth in Mexico. The North American Journal of Economics and Finance, 8(1), 1-21
There are 15 citations in total.

Details

Primary Language English
Subjects Finance, Business Administration
Journal Section Articles
Authors

Sadak Mohamud Hassan This is me 0000-0001-8581-6575

Publication Date July 30, 2023
Published in Issue Year 2023 Volume: 12 Issue: 2

Cite

APA Hassan, S. M. (2023). ANALYZING THE NEXUS BETWEEN FOREIGN TRADE AND ECONOMIC GROWTH IN DJIBOUTI THROUGH THE APPLICATION OF A VAR MODEL (1989-2021). Journal of Business Economics and Finance, 12(2), 83-90. https://doi.org/10.17261/Pressacademia.2023.1740

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