Use this URL to cite or link to this record in EThOS: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.617371
Title: Applicability of neo-classical growth theory to the SAARC5 countries : an empirical assessment
Author: Khan, Ghulam Yahya
ISNI:       0000 0004 5350 4122
Awarding Body: Kingston University
Current Institution: Kingston University
Date of Award: 2014
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Abstract:
This thesis assesses the applicability of the neoclassical "Solow" growth model to the recent experience of the countries within the South Asian Association for Regional Cooperation (SAARC). The Solow growth model carries an implication that some key macroeconomic aggregates will grow at the same rate indicating a "balanced growth". Stochastic versions. of the model interpret balanced growth as stationarity of some so-called "great ratios". They include consumption/income and investment/income ratios, considered in Kuznets' seminal contribution (1942) for the US economy in the early twentieth century. Although Kuznet dismissed international trade as being of negligible consequence, the set of ratios examined here in the case of SAARC countries, are extended to include a trade/income ratio, in recognition of the significant role now played by international trade. The Johansen (1988) and Johansen and Jusilius (1990) maximum likelihood method has been used for estimating and testing long-run steady-state relations in multivariate vector autoregressive models. The empirical support for the balanced growth hypothesis is very limited. Econometric methods that accommodate the impact of structural reforms on economic growth still find only weak evidence for the one-sector neoclassical growth model. The study also investigates the extent of "growth convergence"- a property of the Solow model, within SAARC, by examining the stationarity of relative per capita incomes assessed by unit root tests and permitting structural breaks. It additionally employs Phillips and SuI (2007, 2009) two-factor growth model and the "flexible Fourier trend" method developed by Enders and Lee (2012). The study makes an assessment of regional convergence in the SAARC countries and identifies the consequences of non-convergence and hence draws policy implications for economic integration in South Asia. The results based on data from 1960-2011 reveal that the per capita output is not converging. The key methodologies employed developed from Carlino and Mills (1993) with modification made to them by Li and Papell (1999); Philips and SuI (2007, 2009); Ender and Lee (2012). With or without structural breaks, analyses of the SAARC5 data suggest that per capita output is not converging in these countries.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID: uk.bl.ethos.617371  DOI: Not available
Keywords: Economics and econometrics ; Politics and international studies
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