Abstract
This study used the Autoregressive Distributed Lag (ARDL) Bounds testing approach and Toda-Yamamoto Non-granger causality test to analyze respectively the long-run and causal relationships among economy performance, foreign direct investment, domestic investment and port sector production output in Cote d’Ivoire over the period 1980-2013. The empirical results illustrate that economy performance, foreign direct investment and domestic investment are significant in explaining the productivity of port sector. Therefore, the study suggests focusing on investment strategies that involve private (foreign and domestic) participation in projects dedicated to improve the safety, quality of operations in the sector and transport connectivity.
Highlights
By connecting sea and land transport for the shipment of commodities in huge quantities at lower cost all over the world, port plays a crucial role in promoting national economy
The technique requires in the first stage to define the appropriate lag length m for the vector autoregressive (VAR) model according to Akaike Information Criterion (AIC), or Schwarz Information Criterion (SIC) and select the maximum order of integration for the variables in the system
The cointegration test, we examined the order of integration of the time series by using the Augmented Dicker fuller (ADF) unit root test to ensure that none of the variables is stationary at second difference and avoid spurious results
Summary
By connecting sea and land transport for the shipment of commodities in huge quantities at lower cost all over the world, port plays a crucial role in promoting national economy. By utilizing a Cobb-Douglass production function to model the relationship between port, foreign direct investment (FDI) and economy growth in China, scholars [11] demonstrated that FDI and gross product value of industry have contributed to promote the container throughput of Shenzhen and Guangzhou Ports. Using Vector Error Correction Model, Scholars [17] demonstrated that domestic investment in transport infrastructure will lead to the growth of the Indian economy These findings imply that investment in port sector using foreign capital is a strategic tool to enhance productivity. Empirical studies exploring the impact of economy performance, foreign direct investment and domestic investment on port productivity in developing countries are to our knowledge limited. Section four reports the empirical results, while the last section concludes the paper
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