This paper examines the relationship between exports and economic output for five major\nAsian economies using annual data in an expanded data set and employing unit root and\ncointegration analysis. It employs a Vector Error Correction Model (VECM) that treats all\nvariables in the modified production function as potentially endogenous and then determines\nvia weak exogeneity tests whether some of the key variables can be treated as exogenous\n(omitted from the system). Johansen cointegration tests find a positive long-run relationship\nbetween exports and economic output for the Philippines, Singapore, and Thailand.\nCointegration tests find a negative long-run relationship between exports and economic\noutput for India. The Block Granger causality tests and impulse response functions for the\nPhilippines and Singapore find stronger causality from exports to economic output rather than\nthe reverse. Granger causality tests in level form also find significant causality from exports\nto economic output. No causality exists between exports and economic output in the case of\nIndia. Exports seem to promote economic growth in three of the four countries that have\ncointegrated data, which supports the exports-led growth hypothesis found in some of the\nextant literature. The paper does not find cointegration for China because the variables are\nintegrated of different orders from I(0) to I(2).
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