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Export-Led Recovery in Portugal: Can It Also Sustain Growth?

Export-Led Recovery in Portugal: Can It Also Sustain Growth?

Gonçalo Carvalho, Marta Simões, António Portugal Duarte
Copyright: © 2020 |Pages: 22
ISBN13: 9781799824480|ISBN10: 1799824489|EISBN13: 9781799824497
DOI: 10.4018/978-1-7998-2448-0.ch066
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MLA

Carvalho, Gonçalo, et al. "Export-Led Recovery in Portugal: Can It Also Sustain Growth?." Foreign Direct Investments: Concepts, Methodologies, Tools, and Applications, edited by Information Resources Management Association, IGI Global, 2020, pp. 1476-1497. https://doi.org/10.4018/978-1-7998-2448-0.ch066

APA

Carvalho, G., Simões, M., & Duarte, A. P. (2020). Export-Led Recovery in Portugal: Can It Also Sustain Growth?. In I. Management Association (Ed.), Foreign Direct Investments: Concepts, Methodologies, Tools, and Applications (pp. 1476-1497). IGI Global. https://doi.org/10.4018/978-1-7998-2448-0.ch066

Chicago

Carvalho, Gonçalo, Marta Simões, and António Portugal Duarte. "Export-Led Recovery in Portugal: Can It Also Sustain Growth?." In Foreign Direct Investments: Concepts, Methodologies, Tools, and Applications, edited by Information Resources Management Association, 1476-1497. Hershey, PA: IGI Global, 2020. https://doi.org/10.4018/978-1-7998-2448-0.ch066

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Abstract

The recent expansion of Portuguese exports can not only promote post crisis recovery but also accelerate economic growth if the theoretical predictions on the relationship between exports and growth are correct. The export-led growth hypothesis advocates that export expansion is key in promoting long run performance. However, controversies remain on the causal relationship between the variables. We investigate this nexus for Portugal over the period 1970-2012 by estimating a bivariate VAR model with output and exports and applying cointegration, Granger causality and impulse response analysis. The results show a long-run equilibrium relationship between exports and output supporting the export-led-growth hypothesis. We also investigated the growth impact of exports of manufactured and non-manufactured products. The findings point to the existence of a positive impact of manufactured exports on output and a “limiting” effect of non-manufactured exports supporting in this way the view that what a country exports matters for growth.

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