A long-run and short-run analysis of the macroeconomic interrelationships in Vietnam

Dao Thi Hong Nguyen; Sizhong Sun; Sajid Anwar

doi:10.1016/j.eap.2017.01.006

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A long-run and short-run analysis of the macroeconomic interrelationships in Vietnam

Journal article

Open access

Peer reviewed

A long-run and short-run analysis of the macroeconomic interrelationships in Vietnam

Dao Thi Hong Nguyen, Sizhong Sun and Sajid Anwar

Economic Analysis and Policy, Vol.54, pp.15-25

2017

DOI: https://doi.org/10.1016/j.eap.2017.01.006

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Abstract

VEC

FDI

trade

growth

Vietnam

Using quarterly data over the March 2001 to December 2011 period and employing the vector error correction (VEC) methodology, this paper investigates the interrelationships among GDP, foreign direct investment (FDI), international trade, the inflation rate and state investment in Vietnam. The results of the Johansen cointegration test confirm the presence of a long-run relationship among the variables. The analysis of the short-run dynamics reveals that the impact of a shock to GDP on FDI is more significant than the impact of FDI on GDP. Furthermore, FDI exerts a stronger impact on exports than imports and Vietnam's inflation rate appears to play a crucial role in affecting the dynamics of some of the key economic variables. Our work highlights the need for effective and consistent policies that not only control the rate of inflation but also lead to sustainable economic growth.

Details

Title: A long-run and short-run analysis of the macroeconomic interrelationships in Vietnam
Authors: Dao Thi Hong Nguyen (Author) - Nha Trang University, Vietnam
Sizhong Sun (Author) - James Cook University
Sajid Anwar (Author) - University of the Sunshine Coast - Faculty of Arts, Business and Law
Publication details: Economic Analysis and Policy, Vol.54, pp.15-25
Publisher: Economic Society of Australia Inc.
Date published: 2017
DOI: 10.1016/j.eap.2017.01.006
ISSN: 0313-5926
Organisation Unit: School of Business and Creative Industries; Indigenous and Transcultural Research Centre; University of the Sunshine Coast, Queensland; USC Business School - Legacy
Language: English
Record Identifier: 99450938802621
Output Type: Journal article

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