Linear and nonlinear growth determinants: The case of Mongolia and its connection to China

Man Ying Amanda CHU, Zhihui LV, Niklas F. WAGNER, Wing-Keung WONG

Research output: Contribution to journalArticles

1 Citation (Scopus)

Abstract

We investigate growth determinants for Mongolia as a small emerging economy with respect to China as its large neighbor. Our causality analysis during 1992 to 2017 reveals significant linear as well as nonlinear relationships in growth explanation. China's GDP and coal prices, together with some of their linear and nonlinear lagged components, predict Mongolia's GDP, where a 1 % increase in China's GDP relates to a 1.5% increase in that of Mongolia. Current exchange rates and the nonlinear components of lagged consumer prices also explain growth. Our results underline the role of macroeconomic drivers of growth in emerging economies. Copyright © 2020 Elsevier B.V. All rights reserved.
Original languageEnglish
Article number100693
JournalEmerging Markets Review
Volume43
Early online date19 Mar 2020
DOIs
Publication statusPublished - Jun 2020

Citation

Chu, A. M. Y., Lv, Z., Wagner, N. F., & Wong, W.-K. (2020). Linear and nonlinear growth determinants: The case of Mongolia and its connection to China. Emerging Markets Review, 43. Retrieved from https://doi.org/10.1016/j.ememar.2020.100693

Keywords

  • Economic growth
  • Energy prices
  • Consumer prices
  • Foreign direct investment (FDI)
  • Exchange rates
  • Multivariate Granger causality

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