Manufacturing as Driver of Economic Growth

Rocha, Igor Lopes

doi:10.2139/ssrn.3211881

Cited by 13 publications

(16 citation statements)

References 80 publications

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“…Kaldor's first law of growth states that manufacturing is the engine of growth. This suggests that the faster the growth rate in manufacturing output is, the faster the growth rate of the economy as a whole will be (Rocha, 2018). The Kaldorian theory concentrates on the demand-supply relationships in the manufacturing sector and explores the importance of industrialisation of the manufacturing sector.…”

Section: Theoretical Literaturementioning

confidence: 99%

“…Rasiah (1996) states that the manufacturing sector must be given special attention as it plays a dynamic role in expanding its own growth and that of the other sectors. Rocha (2018) emphasizes that the structuralism view usually stresses that economic development is strongly linked to a radical transformation in the structure of production to suppress obstacles, bottlenecks and other rigidities of underdevelopment. The structuralism literature, therefore, highlights the importance of industrialisation as a process of structural change where the manufacturing sector plays a central role (Chenery, 1975).…”

Section: Theoretical Literaturementioning

confidence: 99%

“…According to Rocha (2018), the structuralism strand states that without dynamic industrialisation, it is not feasible to increase employment, productivity and income per capita and, consequently, to reduce poverty. The main argument stresses that development involves a production reallocation from low productivity to high productivity sectors where increasing returns to scale prevail.…”

Section: Theoretical Literaturementioning

confidence: 99%

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Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries

Moyo

Jeke

2019

J. Bus. Econ. Review

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Objective – The manufacturing sector plays an important role in any economy. However, Africa has experienced significant deindustrialisation over the last few decades, whilst economic growth has been on an upward trend over the same period. The high growth rates have mostly been propelled by improved macroeconomic stability and the commodity price boom. Further, the slowdown in commodity prices has recently caused a deceleration of economic growth which begs the question: Does promoting the manufacturing sector result in higher and sustainable economic growth and reduce unemployment? This study assesses the impact of the manufacturing sector on economic growth in 37 African countries. Methodology/Technique – This study employs the System-GMM Model for the period between 1990 and 2017. This technique is ideal as the number of cross-sectional units is greater than the number of time periods. This technique also caters for problems of endogeneity and heteroscedasticity. Findings – The results show that manufacturing value has a positive effect on economic growth in African countries. Therefore, it is recommended that policy makers enact measures to boost manufacturing output. Novelty –The deceleration of economic growth in African countries coupled with high unemployment and poverty levels has brought the issue of re-industrialisation into the spotlight. This study is vital for policy makers in African countries who seek to promote economic growth and employment levels. The study contributes to literature in African countries by incorporating variables such as human capital and institutional quality which are major determinants of economic growth. Type of Paper: Empirical. Keywords: Manufacturing Value Added; Economic Growth; African Countries; System-GMM. Reference to this paper should be made as follows: Moyo, C; Jeke, L. 2019. Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries, J. Bus. Econ. Review 4(3) 114 – 130 https://doi.org/10.35609/jber.2019.4.3(1) JEL Classification: C23, E23, O14, O40.

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Section: Theoretical Literaturementioning

confidence: 99%

Section: Theoretical Literaturementioning

confidence: 99%

Section: Theoretical Literaturementioning

confidence: 99%

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Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries

Moyo

Jeke

2019

J. Bus. Econ. Review

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“…The first trade relations of the European Union with China were established in 1975. The Trade and Economic Cooperation Agreement, which includes three basic principles of cooperationbusiness, economic and the tasks of the Joint Committee became the fundamental document of trade relations between the EU and China in 1985 [5]. International trade is also subject to a political dialogue that seeks to correct the Long-Term Policy for China-European Relations [6].…”

Section: Introductionmentioning

confidence: 99%

Comparison of neural networks and regression time series in estimating the development of the EU and the PRC trade balance

2019

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China, by GDP, is the second largest economic power, and hence also a key player in the field of international relations. As far as the EU is concerned, it is China's largest trading partner. From this point of view, it is clear that monitoring export and import development between these partners is essential. This paper therefore aims to compare two useful methods, namely the accuracy of time series alignment through regression analysis and artificial neural networks, to assess the evolution of the EU and the People's Republic of China trade balance. Data on the export and import trends of these two partners since 2000 have been used, and it is clear that the trade balance was completely different that year than it is now. The development over time is interesting. The most appropriate curve is selected from the linear regression, and from the neural networks three useful neural structures are selected. We also look at the prediction of future developments while taking into account seasonal fluctuations.

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“…Withal, in developed market economies, during the 1980s and 1990s, the share of industry in gross domestic product and the share of industry employees in total employment decreased, bringing the phenomenon of de-industrialization and stronger service sector. The shift of the manufacturing industry decreased the share of industry in newly produced value and use, as easily as the so-called tertiarization of the economic social system and the greater share of services, and, therefore, distributive trade, in gross domestic product (Rocha, 2018;Ozak, 2018). These phenomena must be brought into account when weighing the importance of distributive trade in generating economic growth of developed countries, such as the European Union in the previous period.…”

Section: Determinants Of Economic Growth In Developed Market Economiesmentioning

confidence: 99%

Distributive Trade and Economic Growth: Eu28 Evidence for the Period 2008-2015

Mladenović

Cuzovic

2019

Journal of Business Economics and Management

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The purpose of this paper is to appoint the causality between economic activity in the sector of distributive trade and the economic growth of 28 European Union nations. Specifically, it examines the impact of changes in turnover per employee in the distributive trade sector in EU member states on the tangible economic growth rate. The determination to adopt this approach stems from the fact that existing studies mainly explore indirect relationship between economic activities in distributive trade and economic development, with less focus on the direct impact of distributive trade on economic growth. The paper utilizes information for the period from 2008 to 2015. The research relies on multiple regression model, with the Hausman test its robustness. The results indicate that a hike in turnover per employee in the distributive trade sector by 10 euros per year in one EU member state increases its real economic growth rate by 0.15% in that same year. The significance of the made results is reflected in the fact that the survey takes into account the last economic crisis, and highlights negative effects of final consumption expenditure of general government % GDP on the tangible economic growth rate in EU member states.

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Manufacturing as Driver of Economic Growth

Cited by 13 publications

References 80 publications

Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries

Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries

Comparison of neural networks and regression time series in estimating the development of the EU and the PRC trade balance

Distributive Trade and Economic Growth: Eu28 Evidence for the Period 2008-2015

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