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The Driving Forces of Economic Growth before and after the 2008 Global Financial Crisis

Author

Listed:
  • Phan The Cong

    (Faculty of Economics and Law, University of Thuongmai, Vietnam)

  • Hoang Khac Lich

    (Faculty of Development Economics, University of Economics and Development, Vietnam National University, Hanoi, Vietnam.)

Abstract

This paper investigates the determinants of economic growth in two different periods, 2002-2008 and 2008-2013. As national output can be determined by the functions of production and consumption, the explanatory variables consist of growth rates of investment, labor, household consumption, government spending and exports. Analyzing the data of 129 countries, this paper has four main findings: (i) Investment and exports have positive impacts on economic growth; (ii) labor has significant positive impact if we investigate the period from 2002 to 2013 as a whole. The effect is only positive in the first period with low statistically significance while remains unclear in the second period; (iii) household consumption has ambiguous impact on economic growth. There exists some evidences (with 90% confidence level) that household consumption might produce a minor adverse effect on economic growth; (iv) the relationship between economic growth and government spending is positive in the first period and negative in the second.

Suggested Citation

  • Phan The Cong & Hoang Khac Lich, 2017. "The Driving Forces of Economic Growth before and after the 2008 Global Financial Crisis," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 575-582.
    • Handle: RePEc:eco:journ1:2017-01-72
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    References listed on IDEAS

    as
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    3. Andreas Bergh & Magnus Henrekson, 2011. "Government Size And Growth: A Survey And Interpretation Of The Evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 25(5), pages 872-897, December.
    4. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    5. Esmaiel ABOUNOORI & Younes NADEMI, 2010. "Government Size Threshold and Economic Growth in Iran," EcoMod2010 259600001, EcoMod.
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    7. Magnus Henrekson & Andreas Bergh, 2010. "Government Size and Implications for Economic Growth," Books, American Enterprise Institute, number 50388, September.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Monika Gupta & Shubhi Bansal, 2020. "Covid-19 Disruption of Middle-Class Monthly Household Income and Budget," International Journal of Economics and Financial Issues, Econjournals, vol. 10(6), pages 10-17.

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    More about this item

    Keywords

    Determinants of Economic Growth; Global Financial Crisis; Public Expenditure;
    All these keywords.

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • G01 - Financial Economics - - General - - - Financial Crises
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines

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