Effects of Trade Openness and Industrial Value Added on Economic Growth in Bangladesh
International Journal of Sustainable Development Research
Volume 2, Issue 2, March 2016, Pages: 6-11
Received: Aug. 4, 2016; Accepted: Sep. 1, 2016; Published: Oct. 17, 2016
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Authors
Shahjahan Ali, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh
Khandaker Jahangir Alam, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh
Md. Shafiul Islam, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh
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Abstract
This study is an attempt to study the empirical relationship among trade openness, industrial value added and economic growth in Bangladesh. Annual time series data set (1981 to 2015) are utilized to detect the connections among the indicators of interest. Unit root test was applied to determine the time series properties of the variables: Gross Domestic Product (GDP), export, import and industrial value added while Ordinary Least Squares (OLS) technique of estimation and Granger causality test were employed to find out direction of causality. The results from the econometric model indicate that imports have a negative relationship while exports positively influence economic growth. The industrial value added also has positive influence on economic growth. It is recommended that Bangladesh should engage in export promotion and import substitution with a view to strengthening the economy and consequently enhance the living standards of its population.
Keywords
Industrial Value Added, Trade Openness, Economic Growth, Bangladesh
To cite this article
Shahjahan Ali, Khandaker Jahangir Alam, Md. Shafiul Islam, Effects of Trade Openness and Industrial Value Added on Economic Growth in Bangladesh, International Journal of Sustainable Development Research. Vol. 2, No. 2, 2016, pp. 6-11. doi: 10.11648/j.ijsdr.20160203.11
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Copyright © 2016 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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