| This dissertation studies the relationship between export and economic growth in Thailand using cointegration, causality, and error correction models. The analysis uses various measures of income by focusing on GDP, nonexport GDP, and absorption. In addition to total exports, agricultural exports and manufacturing exports are separately analyzed. The empirical results have implications for theory and application. All variables in this study are integrated of order one. They are established for cointegration tests in order to include the error correction term in the Granger causality procedure. If the variables were stationary, the standard Granger test would be carried out without the error correction term. The results of cointegration tests imply that there is causality in at least one direction between every type of export and all measures of income. In the causal relationships, there is mixed evidence of unidirectional causality and bidirectional causality between growth of total exports and the three different income measures. The results with agricultural exports tend to favor the export led growth theory in that growth of agricultural exports leads economic growth in Thailand. Output growth does not, however, promote growth of agricultural exports. Thailand has been an agricultural based economy since its initial stages of development. The agricultural sector has been the initiator of the Thai economy, and its export has contributed to economic growth. The results with manufacturing exports tend to favor bidirectional causality, supporting export led growth and the growth driven export hypotheses. There is a simultaneous cause and effect between output and growth of manufactured exports. Elasticities show that absorption is the best measure of income for exports. Manufacturing exports have a more powerful effect on income than agricultural exports. This result suggests that manufactured exports have been an engine of growth. Thailand should continue to promote exports of manufacturing products.;The Thai industrial sectors in the 1990s are more evenly spread between a number of sectors, ranging from consumer manufactured goods to components, parts, and intermediate capital goods. Electrical and electronic consumer goods, computer peripherals and components, integrated circuits, and automobiles and auto parts are key industrial sectors which should be promoted with increasing emphasis on research and development of new and improved products, enhancing technological capacities and product quality, and encouraging more investment. |
