Impact of Oil, Crises and Economic Integration on Growth:

Author

Victoria University, Australia

Abstract

While energy especially oil, crises and economic integration have been playing an important role indevelopment and growth in East West Asia economies and their intertwining relations, only limitedquantitative research on their impact has been carried out and reported for improved debate andcredible policy use. This paper uses an econometric modeling innovation with features superior toexisting methodologies, namely the generalized or endogenous gravity theory (eg, Tran Van Hoa,2004), to provide rigorous substantive evidence satisfying Kydland (2006) data-model consistencycriterion to this impact study for reliable regional policy analysis.The paper first analyses the major economic and trade patterns between the Gulf States andAsian NIEs over the past three decades for relevant historical correlative support. Second, a newendogenous growth model for these economies is constructed and estimated to provide substantivecausal evidence on the impact. Implications of the findings for economic and trade policy developmentbetween the Gulf States and Asian NIEs are then discussed for possible uses by academic, businessand government decision-makers.JEL Classification: C30, C51, F13, F43

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