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Does saving really matter for growth? Mexico (1970-2000)

Author

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  • Maite Alguacil

    (Department of Economics and Institute of International Economics, University Jaume I of Castellon, Spain)

  • Ana Cuadros

    (Department of Economics and Institute of International Economics, University Jaume I of Castellon, Spain)

  • Vicente Orts

    (Department of Economics and Institute of International Economics, University Jaume I of Castellon, Spain)

Abstract

This paper uses the Granger non-causality test procedure developed by Toda and Yamamoto (1995) and Dolado and Lütkepohl (1996) to analyse the saving-growth nexus in Mexico. Contrary to the reverse causation between national saving and domestic income found in recent empirical studies, evidence is presented in favour of Solow's model prediction that higher saving leads to higher economic growth. The confirmation of a saving-growth nexus in this country seems to be related to the inclusion of foreign direct investment (FDI) in the model, as the most relevant component of foreign saving. As this study will try to show, this last variable enhances economic growth and reinforces the connection between the two focus variables in the analysed country. Copyright © 2004 John Wiley & Sons, Ltd.

Suggested Citation

  • Maite Alguacil & Ana Cuadros & Vicente Orts, 2004. "Does saving really matter for growth? Mexico (1970-2000)," Journal of International Development, John Wiley & Sons, Ltd., vol. 16(2), pages 281-290.
    • Handle: RePEc:wly:jintdv:v:16:y:2004:i:2:p:281-290
    DOI: 10.1002/jid.1075
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    Cited by:

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    2. Tang, Chor Foon & Tan, Bee Wah, 2014. "A revalidation of the savings–growth nexus in Pakistan," Economic Modelling, Elsevier, vol. 36(C), pages 370-377.
    3. Jamel Jouini, 2016. "Economic growth and savings in Saudi Arabia: empirical evidence from cointegration and causality analysis," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 23(4), pages 478-495, October.
    4. Piotr Misztal, 2011. "The Relationship Between Savings And Economic Growth In Countries With Different Level Of Economic Development," "e-Finanse", University of Information Technology and Management, Institute of Financial Research and Analysis, vol. 7(2), pages 17-29, August.
    5. Simelane Bongile & Odhiambo Nicholas M., 2019. "The Dynamics of Savings Mobilisation in Lesotho," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 29(3), pages 92-108, September.
    6. Artur Ribaj & Fitim Mexhuani, 2021. "The impact of savings on economic growth in a developing country (the case of Kosovo)," Journal of Innovation and Entrepreneurship, Springer, vol. 10(1), pages 1-13, December.
    7. Soylu Özgür Bayram, 2019. "Do foreign direct investment and savings promote economic growth in Poland?," Economics and Business Review, Sciendo, vol. 5(4), pages 3-22, December.
    8. Ha, Nguyen Thi Thu & Hoa, Lam Ba, 2018. "On the Causality Relationship between Demographic Changes, Economic Growth and Domestic Savings in Vietnam," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 52(2), pages 27-38.
    9. Omar, Masitah & Masih, Mansur, 2017. "Does saving stimulate growth? the case of Malaysia," MPRA Paper 109242, University Library of Munich, Germany.
    10. Alexander Cotte Poveda, 2013. "The relationship between development, investments, insecurity and social conditions in Colombia: a dynamic approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 47(5), pages 2769-2783, August.
    11. Olayiwola, Abiodun S. & Okunade, Solomon O. & Fatai, Musbau O., 2021. "Savings-Growth Nexus Revisited: An Empirical Analysis from Nigeria," African Journal of Economic Review, African Journal of Economic Review, vol. 9(4), September.
    12. Chor Foon Tang & Eu Chye Tan, 2017. "Re-visiting the Savings-Led Growth Hypothesis and Its Stability in East Asian Economies," International Economic Journal, Taylor & Francis Journals, vol. 31(3), pages 436-447, July.
    13. Yaya Keho, 2019. "Relationship Between Savings And Economic Growth In Cote D'Ivoire," International Journal of Economics and Financial Issues, Econjournals, vol. 9(6), pages 202-207.
    14. Taguchi, Hiroyuki, 2021. "A revisit to effects of demographic dynamics on economic growth in Asia," MPRA Paper 110609, University Library of Munich, Germany.
    15. Aadersh Joshi & Sumit Pradhan & Jagadish Prasad Bist, 2019. "Savings, investment, and growth in Nepal: an empirical analysis," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 5(1), pages 1-13, December.
    16. Tang, Chor Foon, 2009. "Does causality technique matter to savings-growth nexus in Malaysia?," MPRA Paper 38535, University Library of Munich, Germany.

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