Year 2019, Volume 6, Issue 2, Pages 82 - 94 2019-06-30

TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE

Kemal Erkisi [1] , Turgay Ceyhan [2]

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Purpose- In this study, the long-term and the short-term relationships between economic growth and trade liberalization for 13 transition countries in Europe were examined.

Methodology- The dataset includes 303 observations from 1995 to 2016 for the variables of gross domestic product (GDP), export (EXP), import (IMP), gross fixed capital formation (GFCF), foreign direct investment (FDI) and human capital (HC). PLS Test, Pesaran (2004) CD-Test, Pesaran (2007) Unit Root Test, Swamy S Homogeneity Test conducted before causality and cointegration analysis. Dumitrescu & Hurlin (2012) Granger Panel Causality Test for short-term causality, and Westerlund ECM Panel Cointegration and PDOLS Estimator for long-term relationships analyses were employed.

Findings- The short-term outcomes revealed that there is a bidirectional causality between (a) EXP and GDP, (b) GFCF and GDP, (c) FDI and GDP, (d) HC and GDP, and a unidirectional causality (e) from IMP to GDP. The long-term results show that (i) a 1% raise in EXP boosts GDP by 0.39%, (ii) a 1% raise in IMP boosts GDP by 0.11% (iii) a 1% raise in GFCF boosts GDP by 0.37% (iv) a 1% raise in FDI reduces GDP by 1.35%, (v) a 1% raise in HC boosts GDP by 0.54% in the long-term.

Conclusion- Both in the short-term and the long-term trade liberalization has a positive impact on economic growth in mutual way between EXP, IMP and GDP as it is argued by the feed-back hypothesis.

Economic Growth, Trade Liberalization, Export, Import, Panel Data Analysis
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Primary Language en
Subjects Management
Journal Section Articles
Authors

Orcid: 0000-0001-7197-8768
Author: Kemal Erkisi (Primary Author)

Orcid: 0000-0001-5225-297X
Author: Turgay Ceyhan

Dates

Publication Date: June 30, 2019

Bibtex @research article { jefa584079, journal = {Journal of Economics Finance and Accounting}, issn = {}, eissn = {2148-6697}, address = {PressAcademia}, year = {2019}, volume = {6}, pages = {82 - 94}, doi = {10.17261/Pressacademia.2019.1047}, title = {TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE}, key = {cite}, author = {Erkisi, Kemal and Ceyhan, Turgay} }
APA Erkisi, K , Ceyhan, T . (2019). TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE. Journal of Economics Finance and Accounting, 6 (2), 82-94. DOI: 10.17261/Pressacademia.2019.1047
MLA Erkisi, K , Ceyhan, T . "TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE". Journal of Economics Finance and Accounting 6 (2019): 82-94 <http://dergipark.org.tr/jefa/issue/46520/584079>
Chicago Erkisi, K , Ceyhan, T . "TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE". Journal of Economics Finance and Accounting 6 (2019): 82-94
RIS TY - JOUR T1 - TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE AU - Kemal Erkisi , Turgay Ceyhan Y1 - 2019 PY - 2019 N1 - doi: 10.17261/Pressacademia.2019.1047 DO - 10.17261/Pressacademia.2019.1047 T2 - Journal of Economics Finance and Accounting JF - Journal JO - JOR SP - 82 EP - 94 VL - 6 IS - 2 SN - -2148-6697 M3 - doi: 10.17261/Pressacademia.2019.1047 UR - https://doi.org/10.17261/Pressacademia.2019.1047 Y2 - 2019 ER -
EndNote %0 Journal of Economics Finance and Accounting TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE %A Kemal Erkisi , Turgay Ceyhan %T TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE %D 2019 %J Journal of Economics Finance and Accounting %P -2148-6697 %V 6 %N 2 %R doi: 10.17261/Pressacademia.2019.1047 %U 10.17261/Pressacademia.2019.1047
ISNAD Erkisi, Kemal , Ceyhan, Turgay . "TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE". Journal of Economics Finance and Accounting 6 / 2 (June 2019): 82-94. https://doi.org/10.17261/Pressacademia.2019.1047
AMA Erkisi K , Ceyhan T . TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE. JEFA. 2019; 6(2): 82-94.
Vancouver Erkisi K , Ceyhan T . TRADE LIBERALIZATION AND ECONOMIC GROWTH: A PANEL DATA ANALYSIS FOR TRANSITION ECONOMIES IN EUROPE. Journal of Economics Finance and Accounting. 2019; 6(2): 94-82.