gender differential paper IJCRB

ijcrb.webs.com
JUNE 2011
INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 2
heteroskedasticity in the model. To detect the multicollinearity in the model we used PP-
Plot. There is pattern of relationship among independent variables. To remove the
multicollinearity we take the second difference of public expenditure then running again
regression among the variables found these coefficients that are almost free form
multicollinearity. For the purpose of detecting the correlation in the model, applied Durbin
Watson test and find that there is no auto correlation exist among the errors.
5. Conclusions and Policy Implications
The aim of this paper is to examine whether exports has positive effect on economic
growth of a developed country and how much it influences its economic development. The
approach used in this paper is ordinary least square method to find out the relationship
between exports and growth for the period of 25 years from year of 1985-2009.
The findings of this paper show that exports have significant positive relationship with
economic growth. Higher the exports more the prosperous economy there would be.
Baldwin and Evenett (2009) also suggest that exports led growth for any country. The
paper also concludes that exports play major role in development of economy of Canada. A
country with high level of exports is more productive in terms of economic growth.
Wagner (2007) Bhagwati and Srinivasan (1979) also share the view of more exports led
economic development that is totally consistent with the findings of this study.
The government of Canada is not very much risk taker as they have limited their exports
only with USA and UK. Due to limited trade partnership, the exports are more vulnerable
for Canada as experienced in 2009 due credit crunch in USA. They should expand their
trade partnership with other developed as well as developing nations. They should expand
their services sector and banking sector which is very much conservative, so that these
sectors can also contribute in economic growth. Major contribution in exports consist of
natural resources which are exported in raw form to other countries if these resources will
be refined and exported in the form of finished products then these can contribute more in
exports income.
Canada experienced decrease in its growth due to reduction in exports for the year of 2009
it can be further area of interest. This paper incorporates the overall exports of Canada,
however further consideration may be the commodity wise exports and its individual
effects on economy. Another gap that can be explored is that Canada is 12 th largest
importer of the world but despite this fact it has sustainable growth over the long period of
time. Moreover, exports of Canada with its major exports partner USA and its sole effects
on the economy of Canada may also be explored.
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