Browsing by Author "Kavaleka, Gracianu Dario"

Now showing 1 - 1 of 1
  • Thumbnail Image
    Item
    The asymmetric nexus between regional trade and economic growth: A case for Namibia
    (University of Namibia, 2023) Kavaleka, Gracianu Dario
    This paper investigates the nonlinear nexus between trade and economic growth at a country level against that of regional level using Namibia as a laboratory provoked by inconsistent, diverging and polarized evidence in antecedent literature. The study uses a multilayered approach to measure the impacts of trading with regional blocs on Namibia’s economic growth compared to that of trading as a sole country and the direction of causality between trade and growth. For country (regional) level analysis, annual time series (panel) data over 1980-2020 (2005-2020) was employed to assess the nonlinear relationship between trade and economic growth in the short and long term for Namibia and its regional blocs partners. The study employs the nonlinear ARDL (NARDL), which allows for a distinction between the effect of positive and negative shocks in the underlying policies. The Wald tests for robustness validity of asymmetric relations was applied. Findings reveals that increased exports are positively related to growth at all levels, while increased imports were found to be contributing to growth only at regional levels. When comparing country level results against regional results, findings show that Namibia benefits more in terms of exports when trading as a sole country. While, in terms of imports, Namibia benefits more by trading with regional blocs. Results show that negative shocks in exports have huge impact than positive shocks at country level, while at regional level, positive shocks have huge impact than negative shocks. Moreover, causality results reveal bidirectional causality between exports and economic growth as well as between exports and imports at regional and country level. To absorb Namibian exports towards accelerated growth benefits more value addition across the SADC, SACU and CMA and structural reforms fostering regional trade are recommended