The impact of trade openness on economic growth: The case of Cote d’Ivoire

Figures & data

Figure 1. Real GDP and trade openness over time, 1965–2014.

Table 1. Descriptive statistics and correlation matrix

Variables	ln GDP	ln K	ln L	ln OP
Panel A: Summary statistics
Mean	13.498	14.059	16.212	13.194
Median	13.444	13.982	16.296	13.180
Maximum	13.934	14.528	16.913	13.639
Minimum	13.204	13.698	15.255	12.739
Std. dev.	0.2030	0.2580	0.5020	0.2090
Interquartile range	0.3643	0.4027	0.8647	0.2251
Skewness	0.5160	0.3900	−0.3770	0.3990
Kurtosis	2.0770	1.9480	1.8680	2.8660
Jarque–Bera	4.0010	3.5710	3.8560	1.3650
Probability	0.1350	0.1670	0.1450	0.5050
Panel B: Correlation matrix
ln GDP	1.000
ln K	0.793^* (0.000)	1.000^*
ln L	−0.773^* (0.000)	−0.512^* (0.000)	1.000^*
ln OP	0.759^* (0.000)	0.511^* (0.000)	−0.389^* (0.005)	1.000^*

Note: Figures in parentheses are p-values.

^* Indicates statistical significance at the 5% level.

Table 2. Results of unit root tests

Series	Level		First difference
	PP	KPSS	PP	KPSS
GDP	−2.541	0.109	−4.418	0.179
K	−2.293	0.185	−1.181	0.164
L	0.083	0.242	−2.119	0.110
OP	−2.026	0.104	−6.560	0.132

Note: 5% critical values for PP and KPSS tests are −3.504 and 0.146, respectively.

Table 3. Results of the ARDL cointegration test

Model	ARDL	F-stat.	Diagnostic tests
			x^2 (Normality)	x^2 (Heteroscedasticity)	x^2 (Correlation)
GDP = f(K, L, OP)	ARDL(1,3,0,0)	7.969^*	0.822	0.729	0.454
OP = f(GDP, K, L)	ARDL(1,5,5,0)	4.922^*	0.656	0.634	0.247
K = f(GDP, L, OP)	ARDL(2,1,0,0)	4.878^*	0.743	0.292	0.313
Level	Critical values (T = 50)
	Lower bounds I(0)			Upper bounds I(1)
5%	3.495			4.689
10%	2.891			3.984

Note: Lag length on each variable is selected using the AIC criterion with maximum lag set to 5. Critical values are generated under the model with unrestricted intercept and no trend.

^* Indicates the rejection of the null hypothesis of no cointegration at 5% level of significance.

Table 4. Long run estimates

Regressor	Dependent variable: Log(GDP)
	ARDL		FMOLS		DOLS
	Coefficient	t-stat.	Coefficient	t-stat.	Coefficient	t-stat.
Capital (K)	0.308^*	4.481	0.301^*	5.527	0.289^*	4.845
Labor (L)	−0.190^*	−4.990	−0.166^*	−5.993	−0.173^*	−6.051
Trade (OP)	0.155^**	1.775	0.350^*	5.670	0.394^*	5.728
Constant	10.20^*	9.842	7.343^*	6.027	7.033^*	5.553

^* Denote statistical significance at the 5%levels.

^** Denote statistical significance at the 10% levels.

Table 5. Short run estimation results

Regressor	Dependent variable: ΔLog(GDP)
	Coefficient	t-stat.	Prob.
ΔK	1.804^*	8.276	0.000
ΔL	−1.692	−1.044	0.302
ΔOP	0.117^*	3.575	0.000
Constant	7.256^*	6.966	0.000
ECM (−1)	−0.706^*	−6.820	0.000

^* Denotes statistical significance at the 5% level.

Table 6. Results of Granger causality tests

Dep. var.	Causal variable
	GDP	Capital	Labor	Trade
GDP	–	0.006^*	0.000^*	0.000^*
Capital	0.302	–	0.000^*	0.035^*
Openness	0.250	0.008^*	0.246	–

Note: Figures reported are p-values of Wald statistics.

^* Indicates significance at the 5% level.

Table 7. Variance decomposition

Period	S.E.	GDP	K	L	OP
Variance decomposition of log(GDP)
1	0.028270	100.0000	0.000000	0.000000	0.000000
3	0.035729	77.64844	2.724370	0.240319	19.38687
5	0.045975	56.19793	11.25348	2.238418	30.31018
7	0.051533	48.48627	16.01268	6.665601	28.83544
8	0.052068	47.56086	15.68864	6.704608	30.04589
9	0.053037	47.04607	15.12396	8.150519	29.67945
10	0.054101	45.47760	14.65369	11.23233	28.63639
11	0.055241	43.80483	14.19886	14.31596	27.68034
12	0.055395	43.58881	14.13734	14.74695	27.52690
13	0.056310	42.80612	14.29173	15.37085	27.53130
14	0.058534	40.34656	17.44010	16.26982	25.94351
15	0.060548	38.27093	20.58389	16.89917	24.24601
Variance decomposition of log(K)
1	0.010288	51.34748	48.65252	0.000000	0.000000
3	0.020250	29.75501	61.38695	0.713085	8.144957
5	0.026251	18.23969	43.76284	0.955979	37.04149
7	0.032313	14.16981	33.28088	1.827843	50.72147
8	0.033602	14.34860	33.84939	1.883073	49.91894
9	0.034424	14.09440	35.21607	1.880525	48.80900
10	0.035634	13.45668	37.39790	2.856560	46.28886
11	0.037493	12.80026	39.80089	5.204063	42.19478
12	0.038975	12.48126	41.04775	7.200671	39.27032
13	0.040149	13.05982	42.17079	7.278688	37.49070
14	0.041530	13.96427	43.66750	6.802938	35.56529
15	0.043064	14.74589	45.41643	6.509529	33.32815
Variance decomposition of log(OP)
1	0.058160	4.414221	1.738856	14.19921	79.64772
3	0.070971	17.87181	1.504599	11.88647	68.73713
5	0.080574	18.50804	4.569071	17.71544	59.20744
7	0.092263	19.16977	14.64157	16.80543	49.38323
8	0.093174	19.13460	15.87941	16.52216	48.46383
9	0.094553	18.91261	17.74884	16.15847	47.18008
10	0.096258	18.27924	19.08557	16.90301	45.73218
11	0.098557	19.54410	20.12771	16.49501	43.83317
12	0.100810	19.28760	21.60437	16.50621	42.60182
13	0.104314	19.81820	23.45972	16.87295	39.84913
14	0.106439	19.72065	24.78345	16.85021	38.64569
15	0.107640	19.28397	24.47340	16.53918	39.70346