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Dynamics between Vietnamese real consumption and economic growth

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  • , AISDL

Abstract

This article uses recent developments in econometric techniques to examine the consumption-led growth hypothesis for Vietnam from 1990–2012. The Granger-causality tests were based on two testing approaches: the vector error correction modeling approach outlined in Toda and Philips, and the augmented level VAR modeling with integrated and cointegrated processes (of arbitrary orders) separately introduced by Toda and Yamamoto (1993) and Dolado and Lütkepohl (1996). Empirical results reveal the mutual exogeneity between the Vietnamese real consumption and GDP growth. This exogeneity poses great challenges for the Vietnamese policymakers who must rebalance their transitional economy. This change, necessitated by recent crises in the international economic landscape, necessitates a shift in the Vietnamese economy from an export-led growth economy to a more inclusive, services-oriented, and consumer-based.

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  • , Aisdl, 2015. "Dynamics between Vietnamese real consumption and economic growth," OSF Preprints jqu3x, Center for Open Science.
    • Handle: RePEc:osf:osfxxx:jqu3x
    DOI: 10.31219/osf.io/jqu3x
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    References listed on IDEAS

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    1. Toda, Hiro Y & Phillips, Peter C B, 1993. "Vector Autoregressions and Causality," Econometrica, Econometric Society, vol. 61(6), pages 1367-1393, November.
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    4. Toda, Hiro Y. & Yamamoto, Taku, 1995. "Statistical inference in vector autoregressions with possibly integrated processes," Journal of Econometrics, Elsevier, vol. 66(1-2), pages 225-250.
    5. Banerjee, Anindya & Dolado, Juan J. & Galbraith, John W. & Hendry, David, 1993. "Co-integration, Error Correction, and the Econometric Analysis of Non-Stationary Data," OUP Catalogue, Oxford University Press, number 9780198288107.
    6. Frederic S. Mishkin, 1995. "Symposium on the Monetary Transmission Mechanism," Journal of Economic Perspectives, American Economic Association, vol. 9(4), pages 3-10, Fall.
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    10. Kim, Annette Miae, 2008. "Learning to be Capitalists: Entrepreneurs in Vietnam's Transition Economy," OUP Catalogue, Oxford University Press, number 9780195369397.
    11. Vuong, Quan-Hoang, 2012. "Vietnam's Economic Challenges," OSF Preprints g8tdz, Center for Open Science.
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