| Pub. Date | : June, 2020 |
|---|---|
| Product Name | : The IUP Journal of Financial Risk Management |
| Product Type | : Article |
| Product Code | : IJFRM30620 |
| Author Name | : Amit Kundu, Anil Kumar Goyal |
| Availability | : YES |
| Subject/Domain | : Finance Management |
| Download Format | : PDF Format |
| No. of Pages | : 10 |
Growth-Led Export (GLE) is extremely likely, unless the supply and demand caused by growth leads to anti-trade bias (Bhagwati, 1998). The theory based on neoclassical understanding also promotes this hypothesis (Findlay, 1984) that other variables, besides exports, are accountable for increasing production (e.g., growth factor in productivity or primary input growth). Kaldor (1964), Lancaster (1980), Krugman (1984), and Stavrinos (1987) have also explained GLE ideology. According to them, economic development leads to skills and technology enhancement, leading to improved productivity and competitive advantages for the nation promoting exports.
Growth-Led Export (GLE) is extremely likely, unless the supply and demand caused by growth leads to anti-trade bias (Bhagwati, 1998). The theory based on neoclassical understanding also promotes this hypothesis (Findlay, 1984) that other variables, besides exports, are accountable for increasing production (e.g., growth factor in productivity or primary input growth). Kaldor (1964), Lancaster (1980), Krugman (1984), and Stavrinos (1987) have also explained GLE ideology. According to them, economic development leads to skills and technology enhancement, leading to improved productivity and competitive advantages for the nation promoting exports. One fascinating prospect is the feedback relationship between exports and economic development. Helpman and Krugman (1985) argue that exports can rise because of productivity gains from realizing economies of scale. The increase in exports may also allow cost savings, which may lead to more gains from productivity. Bhagwati (1998) surmises that augmented trade (regardless of cause) yields added profits, and added profits contribute to further growth in the industry. There are several studies on the relationship between export and economic growth, but there is no common consensus among the different studies (Henriques and Sadorsky, 1996; Ekanayake, 1999; Funke and Ruhwedel, 2005; Anoruo and Ramchande, 2008; Kilavuz and Topcu, 2012; Shahryar and Mehdi, 2012; Dar et al., 2013; Kumari and Malhotra, 2014; and Anwar and Sampath, 2000), so investigation on this topic is much needed.