Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan
Abstract This paper examines the causal relationship between governance indicators and economic growth in Afghanistan. We use a set of quarterly time series data from 2003Q1 to 2018Q4 to test our hypothesis. Following Toda and Yamamoto’s (J Econom 66(1–2):225–250, 1995. https://doi.org/10.1016/0304-...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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SpringerOpen
2020-11-01
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| Series: | Future Business Journal |
| Subjects: | |
| Online Access: | http://link.springer.com/article/10.1186/s43093-020-00039-4 |
| _version_ | 1818301257776889856 |
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| author | Mohammad Naim Azimi Mohammad Musa Shafiq |
| author_facet | Mohammad Naim Azimi Mohammad Musa Shafiq |
| author_sort | Mohammad Naim Azimi |
| collection | DOAJ |
| description | Abstract This paper examines the causal relationship between governance indicators and economic growth in Afghanistan. We use a set of quarterly time series data from 2003Q1 to 2018Q4 to test our hypothesis. Following Toda and Yamamoto’s (J Econom 66(1–2):225–250, 1995. https://doi.org/10.1016/0304-4076(94)01616-8 ) vector autoregressive model and the modified Wald test, our empirical results show a unidirectional causality between the government effectiveness, rule of law, and the economic growth. Our findings exhibit significant causal relationships running from economic growth to the eradication of corruption, the establishment of the rule of law, quality of regulatory measures, government effectiveness, and political stability. More interestingly, we support the significant multidimensional causality hypothesis among the governance indicators. Overall, our findings not only reveal causality between economic growth and governance indicators, but they also show interdependencies among the governance indicators. |
| first_indexed | 2024-12-13T05:20:09Z |
| format | Article |
| id | doaj.art-d6757ad02d464938ac945704ac0ec61b |
| institution | Directory Open Access Journal |
| issn | 2314-7210 |
| language | English |
| last_indexed | 2024-12-13T05:20:09Z |
| publishDate | 2020-11-01 |
| publisher | SpringerOpen |
| record_format | Article |
| series | Future Business Journal |
| spelling | doaj.art-d6757ad02d464938ac945704ac0ec61b2022-12-21T23:58:21ZengSpringerOpenFuture Business Journal2314-72102020-11-016111410.1186/s43093-020-00039-4Hypothesizing directional causality between the governance indicators and economic growth: the case of AfghanistanMohammad Naim Azimi0Mohammad Musa Shafiq1Faculty of Economics, Kabul UniversityFaculty of Economics, Kabul UniversityAbstract This paper examines the causal relationship between governance indicators and economic growth in Afghanistan. We use a set of quarterly time series data from 2003Q1 to 2018Q4 to test our hypothesis. Following Toda and Yamamoto’s (J Econom 66(1–2):225–250, 1995. https://doi.org/10.1016/0304-4076(94)01616-8 ) vector autoregressive model and the modified Wald test, our empirical results show a unidirectional causality between the government effectiveness, rule of law, and the economic growth. Our findings exhibit significant causal relationships running from economic growth to the eradication of corruption, the establishment of the rule of law, quality of regulatory measures, government effectiveness, and political stability. More interestingly, we support the significant multidimensional causality hypothesis among the governance indicators. Overall, our findings not only reveal causality between economic growth and governance indicators, but they also show interdependencies among the governance indicators.http://link.springer.com/article/10.1186/s43093-020-00039-4GovernanceThe rule of lawCorruption controlEconomic growthCausality |
| spellingShingle | Mohammad Naim Azimi Mohammad Musa Shafiq Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan Future Business Journal Governance The rule of law Corruption control Economic growth Causality |
| title | Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan |
| title_full | Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan |
| title_fullStr | Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan |
| title_full_unstemmed | Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan |
| title_short | Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan |
| title_sort | hypothesizing directional causality between the governance indicators and economic growth the case of afghanistan |
| topic | Governance The rule of law Corruption control Economic growth Causality |
| url | http://link.springer.com/article/10.1186/s43093-020-00039-4 |
| work_keys_str_mv | AT mohammadnaimazimi hypothesizingdirectionalcausalitybetweenthegovernanceindicatorsandeconomicgrowththecaseofafghanistan AT mohammadmusashafiq hypothesizingdirectionalcausalitybetweenthegovernanceindicatorsandeconomicgrowththecaseofafghanistan |