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| Relationship between resources use and economic growth in Fujian Province: an ARDL approach |
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Abstract Material flow analysis (MFA) approach and the newly developed autoregressive distributed lag (ARDL) approach were integrated to examine the relationship between resource use and real GDP for Fujian Province, during the period of 1990-2008. The proxy variable of resource use could be estimated by measuring direct material input (DMI), a sub-account of MFA. A long-run equilibrium cointegration relationship could be found to exist between resource use and the explanatory variable: economic growth, using the ARDL bounds testing. The long-run parameter of economic growth on resource use was estimated to be approximately 0.73 through a long-run static solution of the ARDL model, and that for the short-run was estimated by the error correction model. The long-run Granger causality could also be found to exist from economic growth to resource use. Some suggestions on economic development and resource conservation strategies for Fujian Province were proposed as a result. Furthermore, the fresh idea and methodology employed in this study could be readily extended to cover other regions for the analysis on the causal link between resource use and economic development.
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Received: 28 May 2010
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