• The Journal of Asian Finance, Economics and Business
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• v.3 no.3
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• pp.27-37
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• 2016

This study uses an endogenous economic growth model to determine the long run relationship between trade openness and economic growth in China by using the data 1975-2009.It contributes to the literature by developing trade openness index. An autoregressive distributed lag approach to cointegration and rolling regression method are employed. This study tests the link between trade openness and economic growth in the case of China by using the framework of endogenous economic growth model. This study also employs the rolling window regression method in order to examine the stability of coefficients throughout the sample span. The autoregressive distributed lag (ARDL) cointegration technique and rolling regression method are used. The empirical findings indicate that trade openness (i.e. Both individual trade indicator and composite trade openness index) are positively related to economic growth in the long run and short run. Our results indicate that trade openness as measured by individual trade indicator and composite trade openness index are positively related to economic growth in the long run and short run. However, results from the rolling window suggest that trade openness is negatively linked to economic growth only for a number of years.

• Journal of Korea Trade
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• v.26 no.2
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• pp.1-20
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• 2022

Purpose - Multiple stakeholders-including politicians, investors, and the wider public-have questioned the value of investing in port infrastructure improvements and the contributions they can make to economic performance. Design/methodology - This paper presents an empirical study of 56 countries with seaports from the year 2006 to 2019 to determine how the quality of port infrastructure affects its contribution in terms of trade openness and economic growth. To this end, this study applies hierarchical multiple regression analysis with panel data to empirically examine the economic impact of port infrastructure quality on the relationship between trade openness and economic growth. After the 56 selected countries were categorized as developed or developing, a multi-group panel data analysis was conducted. Findings - The results of this study show that trade openness has a significant positive effect on the national economy. The findings also indicate that, although developing countries should expect greater economic growth after investing in port infrastructure, this relationship weakens as developing countries become richer. Originality/value - The findings of this study not only elucidate the relationship between trade openness and national economic growth, but they also emphasize the importance of trade openness and port infrastructure in national economic growth, particularly among developing countries.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.12
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• pp.73-84
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• 2020

The study aims to investigate the dual effects of corruption control on economic growth in relationship with the stock market and trade openness in developing countries. The study used difference S-GMM method on the dynamic panel data model in the period (2002-2017) with data collected from the World Bank. The study discovers the dominant impacts of corruption control in the relationship with the stock market on economic growth. At the same time, the study also confirms the overwhelming impact of corruption control in the relationship between trade openness and economic growth in the developing countries. In addition, the study shows that inefficient stock markets in developing countries will not promote economic growth. Meanwhile, the long-standing credit market has a positive impact on economic growth. With the strong development of stock market and trade openness in the period (2002-2017), control on corruption in developing countries does not get better in time with the increase in demand. The findings of this study suggest a number of solutions to strengthen corruption control, leading to the increased efficiency on the stock market and as well as encouraging the positive effects of trade openness to contribute to promoting economic growth in developing countries.

• The Journal of Asian Finance, Economics and Business
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• v.6 no.3
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• pp.151-162
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• 2019

The paper examines the effects of Foreign Direct Investment (FDI) on the economic growth of Lao People's Democratic Republic (Lao PDR) between 1993 and 2015. The investigation is based on the influence of growth and economic absorptive capability determinants such as human capital, trade openness, and institutional quality. The methodological analysis uses a multivariate framework accounting capital stock, labor stock, FDI, human capital, trade openness, and institutional quality in regression of the Vector Autoregressive model. Augmented Dickey-Fuller unit root test, Johansen Cointegration test, and Granger Causality test were applied as parts of the econometric time-series analysis approach. The empirical results demonstrate the positive effects of FDI and trade openness, and the negative effects of human capital and institutional quality on the economic growth of the Lao PDR over the 1993 to 2015 period. The findings confirm that trade openness complemented by a sufficient level of infrastructure, education, quality institutions, and transparency significantly influence economic growth and attract more FDI. Research results lend credence to the need for the Lao PDR's government to focus on improving its economic absorptive capability and economic competitiveness regionally and globally by improving wealth and resource management strategies, as failure to take this course of action could lead to the Dutch Disease effects.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.3
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• pp.191-199
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• 2021

The study examines the causal relationship between financial development and economic growth through trade openness for the leading ASEAN countries (Indonesia, the Philippines, Malaysia, Singapore, Thailand, and Vietnam). The study employs a panel data for the period of 25 years spanning from 1995 to 2015 for the six countries, yielding a balanced panel of 150 observations. Fixed effect model (FEM) and random effect model (REM) are used for the panel data, following the Hausman test performed for model selection. The trivariate Granger causality test is also used to check for possible relationship between the variables. The results show that REM is chosen based on the Hausman test result, suggesting that the trade openness has a positive association with growth whereas the financial development is positively, but insignificantly associated with growth. The reason for this is that the financial development and economic growth may be related to each other. The results are, then, further explored and confirmed by the causality test. That is, the financial development and the economic growth, through the trade openness, are found to have bidirectional positive relationships. This implies that there would be shortcomings when ignoring the presence of trade openness, which positively impacts the relationship between finance and growth.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.2
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• pp.295-303
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• 2022

Information and communication technology (ICT) is one of the primary zones that stimulates economic development in today's globalized world. It promotes technological developments in worldwide communication and manufacturing systems, as well as economic growth and development. Many economic activities, such as international trade and foreign direct investment, rely heavily on contemporary information and communications technologies (FDI). The goal of this study is to look at the dynamic relationship between FDI, ICT, trade openness, and economic growth in the context of BRICS countries from 2000 to 2018, with Gross Domestic Product as the dependent variable and Telephone subscriptions, Mobile subscriptions, Broadband subscriptions, Internet subscribers, Secure internet servers, Trade, and Foreign direct investment as the independent variables.Two variables are used as proxies to manage the macroeconomic environment, while five variables are used as proxies for ICT infrastructures. The outcomes of this study are analyzed using Generalized Methods of Movements (GMM). According to this study, ICT has a positive impact on the economic growth of a few countries. Trade openness and foreign direct investment, on the other hand, have a negative impact on economic growth. As growing countries, the BRICS must participate in economic reform and liberalization measures. This report suggests policy proposals for improving ICT standards, focusing especially on economic growth, trade openness, and increasing foreign investment in the BRICS countries.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.8
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• pp.345-353
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• 2021

The impact of investment on economic growth has been studied by many authors around the world with different times and research methods. Therefore, there are conflicting opinions about the impact of investment on economic growth. To contribute empirical evidence, the objective of this study is to assess the impact of investment sources such as public investment, private investment, and foreign direct investment on economic growth in Vietnam in the short-run and long-run. The data used for the study is panel data from 63 Vietnamese provinces between 2000 and 2020. The inquiry method is PMG (Pool Mean Group) regression for economic growth (GDP) after testing the stationarity of the variables that meet the PMG regression condition as suggested by Pesaran et al. (1996) and Hamuda et al. (2013). The results show that: factors such as labor and trade openness have a negative impact on economic growth in the short term. In the long run, public investment has a negative effect on economic growth, while domestic private investment, foreign direct investment, trade openness, and labor have positive effects on economic growth. Labour contributes the most, followed by trade openness, foreign direct investment, and domestic private investment. Finally, the study provides policy implications for the Government of Vietnam.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.12
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• pp.75-83
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• 2021

Variation in demand, natural resource availability, and technological advancement within a country are the main reasons for necessitating export and import activities between nations. Accordingly, this paper aims to analyze the effect of economic openness on Multifactor Productivity (MFP) in selected Asian countries (Vietnam, Thailand, The Philippines, Indonesia, Cambodia, China, Japan, Malaysia, South Korea, and Singapore) based on data for the period 1990-2018. The analysis conducted in the study employed the panel ARDL approach based on the estimation by Pooled Mean Group (PMG), Mean Group (MG), and Dynamic Fixed Effect (DFE). The Hausman test conducted indicates that the PMG estimation is better than that of MG and DFE since it has a higher variability value than the significance value. The results revealed that economic openness is able to elicit significant and positive effects on short-term and long-term MFP growth. In addition, the study established that other variable, such as the number of schooling years, are also able to produce a positive and significant effect on MFP growth in the long term. Since economic openness can impact MFP growth, every country should thus increase its export activities through more capital and worker inputs that will stimulate greater production.

• International Area Studies Review
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• v.14 no.3
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• pp.477-498
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• 2010

This paper studies economic growth convergence conditioning on various characteristics of East Asian countries. Our findings suggest that when trade openness is conditioned in addition to human capital and investment, the economic growth rates for East Asian countries converge faster than when human capital and investment alone are considered. In particular, while Northeast Asian countries exhibit absolute economic growth convergence as well as economic growth convergence conditioned on trade openness, Southeast Asian countries show only economic growth convergence conditioned on trade openness. Analysis of policy implications based on the results of the first East Asian countries' high dependence on foreign trade, trade openness in the convergence of economic growth has had a significant positive effect. Second, in order to establish a regional economic integration in East Asia, Northeast Asia and Southeast Asia, the country's economic growth is necessary to reduce the gap.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.2
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• pp.49-59
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• 2022

The relationship between income inequality and capital account openness is empirically investigated in this study, where macroeconomic variables have opposing effects. Panel data used in the study from the KAOPEN Index and World Bank consists of 28 Asian countries and has been examined; it contains annual observations from 1970 to 2018. The data is examined using a random-effect model based on GMM estimates. Income inequality and capital account openness are positively and significantly related, according to our findings. Overall, the findings imply that increasing income gaps reduced capital investment in nations with large discrepancies. The growing economic discrepancy is being caused by the rich's increasing income share at the expense of the poor. In Asia, inward capital account openness exacerbates income inequality, while outward capital account openness exacerbates it. As a result, income inequality slows economic growth, leading to inflation, unemployment, and increased government spending in several Asian countries. Our control factors, GDP, and other secondary school enrolments, all had a statistically significant negative relationship with income inequality. Income disparity has a positive and statistically significant association with government spending, inflation, population, trade openness, and unemployment. Income disparity has a negative association with capital account openness, gross domestic product, and secondary school enrollment.