The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach

Israel Bereket

doi:doi:10.11648/j.jwer.20200901.13

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The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach

Israel Bereket

Published in Journal of World Economic Research (Volume 9, Issue 1)

Received: 4 September 2019 Accepted: 24 October 2019 Published: 7 January 2020

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Abstract

This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.

Published in	Journal of World Economic Research (Volume 9, Issue 1)
DOI	10.11648/j.jwer.20200901.13
Page(s)	20-26
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2020. Published by Science Publishing Group

Keywords

Export Performance, Auto Regressive Distributive Lag Model, Export Diversification Index

References

[1]	Adebusuy, B. (2004). Stabilization of Commodity Market of Interest to Africa: Working Paper.
[2]	Beshir, M. (2010). The Determinants of Export of Primary Commodities in Sub-Saharan Africa: A Panel Co-Integration Approach. MSc thesis.
[3]	Denekew, A. (2016). The Determinate of Export Performance in East African Countries: A Panel Data Approach. A Master Thesis Submitted to School of Graduate Studies Addis Ababa University. Addis Ababa, Ethiopia.
[4]	Granger, E. a. (1987). Co-integration and error correction: representation, estimation and testing.
[5]	Johansen, S. and Juselius, K. (1990) Maximum likelihood estimation and inference on co-integration with applications to the demand for money, Oxford Bulletin of Economics and Statistics 52: 169–210.
[6]	Johansen, S. (1991) Estimation and hypothesis testing of co-integration vectors in Gaussian vector autoregressive models. Econometrica 59: 1551–1580.
[7]	Johansen, S. (1992) The role of the constant term in co-integration analysis of non stationary variables. Forthcoming in Econometric Reviews.
[8]	Kiros, H. (2012, Ethiopia). Determinants of Export Growth Rate in Ethiopia 1980-2010: Co Integration and Error Correction Model Analysis.
[9]	Nega, M. (2013). The main determinants of export performance in Ethiopia for the period 1974-2011, Addis Ababa University, Addis Ababa, Ethiopia.
[10]	Pesaran et al, (2001) Bounds testing approaches to the analysis of level relationships, Journal of Applied Econometrics, 16 (2001), pp. 289-326.
[11]	Tigist, Y. (2015). Impact of Agricultural Export on Economic Growth in Ethiopia: The Case of Coffee, Oilseed and Pulses. Egerton University, Department of agricultural economics and agri business managment.
[12]	UNCTAD. (2016). various issue.
[13]	World Bank. (2013). World Development Indicator. World Bank.

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Israel Bereket. (2020). The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. Journal of World Economic Research, 9(1), 20-26. https://doi.org/10.11648/j.jwer.20200901.13

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ACS Style

Israel Bereket. The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. J. World Econ. Res. 2020, 9(1), 20-26. doi: 10.11648/j.jwer.20200901.13

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AMA Style

Israel Bereket. The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. J World Econ Res. 2020;9(1):20-26. doi: 10.11648/j.jwer.20200901.13

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@article{10.11648/j.jwer.20200901.13,
  author = {Israel Bereket},
  title = {The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach},
  journal = {Journal of World Economic Research},
  volume = {9},
  number = {1},
  pages = {20-26},
  doi = {10.11648/j.jwer.20200901.13},
  url = {https://doi.org/10.11648/j.jwer.20200901.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jwer.20200901.13},
  abstract = {This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.},
 year = {2020}
}

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TY  - JOUR
T1  - The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach
AU  - Israel Bereket
Y1  - 2020/01/07
PY  - 2020
N1  - https://doi.org/10.11648/j.jwer.20200901.13
DO  - 10.11648/j.jwer.20200901.13
T2  - Journal of World Economic Research
JF  - Journal of World Economic Research
JO  - Journal of World Economic Research
SP  - 20
EP  - 26
PB  - Science Publishing Group
SN  - 2328-7748
UR  - https://doi.org/10.11648/j.jwer.20200901.13
AB  - This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.
VL  - 9
IS  - 1
ER  -

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Author Information

Israel Bereket

Department of Economics, Jinka University, Jinka, Ethiopia

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Plain Text BibTeX RIS

APA Style

Israel Bereket. (2020). The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. Journal of World Economic Research, 9(1), 20-26. https://doi.org/10.11648/j.jwer.20200901.13

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ACS Style

Israel Bereket. The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. J. World Econ. Res. 2020, 9(1), 20-26. doi: 10.11648/j.jwer.20200901.13

Copy | Download

AMA Style

Israel Bereket. The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach. J World Econ Res. 2020;9(1):20-26. doi: 10.11648/j.jwer.20200901.13

Copy | Download

@article{10.11648/j.jwer.20200901.13,
  author = {Israel Bereket},
  title = {The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach},
  journal = {Journal of World Economic Research},
  volume = {9},
  number = {1},
  pages = {20-26},
  doi = {10.11648/j.jwer.20200901.13},
  url = {https://doi.org/10.11648/j.jwer.20200901.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jwer.20200901.13},
  abstract = {This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.},
 year = {2020}
}

Copy | Download

TY  - JOUR
T1  - The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach
AU  - Israel Bereket
Y1  - 2020/01/07
PY  - 2020
N1  - https://doi.org/10.11648/j.jwer.20200901.13
DO  - 10.11648/j.jwer.20200901.13
T2  - Journal of World Economic Research
JF  - Journal of World Economic Research
JO  - Journal of World Economic Research
SP  - 20
EP  - 26
PB  - Science Publishing Group
SN  - 2328-7748
UR  - https://doi.org/10.11648/j.jwer.20200901.13
AB  - This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.
VL  - 9
IS  - 1
ER  -

Copy | Download