Export growth and economic growth: the tunisian experience

This paper attempts to test the export-led-growth theory using Tunisian data. The dynamic interaction between export growth and economic growth is modeled within a vector-error-correction model using the Johansen technique of co-integration and the Granger test of causality. The analysis shows that the level of output and exports share a common stochastic trend that is consistent with Granger-causality running in both directions between economic growth and export growth. In particular causality is found to be the result of the variables adjusting to their long-run equilibrium relationship. Given the robustness of the results, the Tunisian experience shows support for the export-led growth theory and, thus, the paper recommends that Tunisian policymakers should consider export promotion an engine to economic growth