Page 527 - 2016 - Vol. 40
P. 527

between exports and output using three-stage least squares
(3SLS) method. The results suggest a positive and
significant relationship between GDP and exports growth.

       Barro (1991) reported mixed results. In his cross-
section study of 98 nations between the years 1960 and
1985, he found that increases in government consumption
and expenditure measured as a percent of national income
reduce per capita growth.

       Ahmed (1996) argued that, "the justification for
exports diversification in Sub- Sahra Africa lies in their
weak exports base, which make them exposed to abrupt
changes in commodity market that are beyond the direct
influence of policy maker. The recent experience shows
that there is a close relationship between commodity
diversification and economic performance and that
undiversified economies were generally underachiever,
even when commodity prices were favorable. Experience
from East Asia, Latin America shows that the faster the
growth in commodities, the more rapid the diversification
of the economy away from commodities and toward
manufacturing".

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