Relationship between manufacturing activity and economic growth globally: an approach using panel data

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Published: nov. 9, 2020
Keywords:
Manufacture;, Manufacture, Economic growth, Cointegration, Causality

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Joseph Cruz
Universidad Nacional de Loja
Junior Silva
Universidad Nacional de Loja
Michelle López-Sánchez
Universidad Nacional de Loja

Abstract

The present research aims to examine the effect of manufacturing activity on global economic growth during 1995-2015. We use data collected by the World Development Indicators (2019) and cointegration techniques to explore the relationship between manufacturing and economic growth with high economic instability. Using an error correction model, we verify the existence of a short-term relationship between economic growth and manufacturing. Furthermore, we found Granger's (1988) causality between the two variables with medium-high per capita income. An economic policy implication derived from this research is the creation of industrial development programs in those underdeveloped economies to balance income differences concerning other regions with a more significant industry.

Article Details

How to Cite
Cruz, J., Silva, J., & López-Sánchez, M. (2020). Relationship between manufacturing activity and economic growth globally: an approach using panel data. Revista Económica, 8(1), 76–85. Retrieved from https://revistas.unl.edu.ec/index.php/economica/article/view/844
Issue
Vol. 8 No. 1 (2020): Revista Económica vol 8 (Enero-Junio 2020)
Section
RESEARCH ARTICLES
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