AN ANALYSIS FOR THE RELATIONSHIP BETWEEN TRADE OPENNESS AND ECONOMIC GROWTH: EVIDENCE FOR TEN AFRICAN COUNTRIES

Abstract

The empirical results for the relationship between trade openness and economic growth have long been a debatable matter in international economics literature . To re - investigate the relationship ; firstly , we analyzed the homogeneity and cross - sectional dependency tests of the variables to determine appropriate unit roots and cointegration tests . We use data set includes 10 Africa countries for the period of 1990 - 2015 . We employ pool mean group estimator (PMG) under the panel Autoregressive distributed lag (ARDL) model framework . This study complements existing literature by examining the relation between economic growth and trade openness using a panel ARDL approach for Africa countries . The results of PMG model suggest that an increase in trade openness has positive impact on economic growth in the long run . The evidence of a long - run relationship between the variables implies the validity of the long - run openness - led growth hypothesis in selected countries .