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The Relationship between Non-Oil Trade and GDP in Petroleum Exporting Countries

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Abstract:

This paper investigates the causal relationship between non-oil international trade and the GDP in a panel of 11 selected oil exporting countries by using panel unit root tests and panel cointegration analysis. A three-variable model is formulated with oil revenues as the third variable. The results show a strong causality from oil revenues and economic growth to trade in the oil exporting countries. Yet, non-oil trade does not have any significant effects on GDP in short- and long-run. It means that it is the oil and GDP that drives the trade in mentioned countries, not vice versa. According to the results, decision makings should be employed to achieve sustainable growth through higher productivity and substantially enlarging the economic base diversification in the future.

Info:

Periodical:
International Letters of Social and Humanistic Sciences (Volume 12)
Pages:
63-70
DOI:
10.18052/www.scipress.com/ILSHS.12.63
Citation:
M. Mehrara "The Relationship between Non-Oil Trade and GDP in Petroleum Exporting Countries", International Letters of Social and Humanistic Sciences, Vol. 12, pp. 63-70, 2014
Online since:
Oct 2013
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