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Exploring the role of energy, trade and financial development in explaining economic growth in South Africa: A revisit

Kumar, Ronald R. and Stauvermann, P.J. and Loganathan, Nanthakumar and Kumar, Radika D. (2015) Exploring the role of energy, trade and financial development in explaining economic growth in South Africa: A revisit. Renewable and Sustainable Energy Reviews, 52 . pp. 1300-1311. ISSN 1364-0321

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    Abstract

    South Africa is an emerging and industrializing economy which is experiencing remarkable progress. We contend that amidst the developments in the economy, the role of energy, trade openness and financial development are critical. In this article, we revisit the pivotal role of these factors. We use the ARDL bounds [72], the Bayer and Hanck [11] cointegration techniques, and an extended Cobb–Douglas framework, to examine the long-run association with output per worker over the sample period 1971–2011. The results support long-run association between output per worker, capital per worker and the shift parameters. The short-run elasticity coefficients are as follows: energy (0.24), trade (0.07), financial development (−0.03). In the long-run, the elasticity coefficients are: trade openness (0.05), energy (0.29), and financial development (−0.04). In both the short-run and the long-run, we note the post-2000 period has a marginal positive effect on the economy. The Toda and Yamamoto [91] Granger causality results show that a unidirectional causality from capital stock and energy consumption to output; and from capital stock to trade openness; a bidirectional causality between trade openness and output; and absence (neutrality) of any causality between financial development and output thus indicating that these two variables evolve independent of each other.

    Item Type: Journal Article
    Subjects: H Social Sciences > HA Statistics
    H Social Sciences > HB Economic Theory
    H Social Sciences > HG Finance
    Divisions: Faculty of Business and Economics (FBE) > School of Accounting and Finance
    Faculty of Business and Economics (FBE)
    Depositing User: Ronald Kumar
    Date Deposited: 27 Aug 2015 15:50
    Last Modified: 27 Apr 2016 16:47
    URI: http://repository.usp.ac.fj/id/eprint/8403
    UNSPECIFIED

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