Abstract

This paper, to the best of my knowledge, is the first to estimate the association between Nighttime Lights (NTL) and real Gross Domestic Product (GDP) at the national level, using sub-national GDP data for the 27 Egyptian governorates over FY08-FY13. The study finds that NTL has a positive and statistically significant correlation with GDP at the sub-national and national levels. Hence, NTL can measure and predict GDP in Egypt, at the national and sub-national levels. These findings affirm most previous research that NTL could be a good proxy for GDP when official data are unavailable or time infrequent in developing countries.

Highlights

  • Gross Domestic Product (GDP) at the national and sub-national levels are the most widely used indicators for the analysis of economic performance and reference for political decision making

  • This paper aims at finding a good proxy for estimating economic performance at the national level using disaggregated regional GDP (GGP1) in Egypt

  • Traditional approach of measuring GDP and other economic indicators based on estimates, surveys and censuses suffers from potential biases, time lags, 1 Throughout the paper, GDP at the sub-national level is referred to as “Gross Governorate Product” (GGP) and GDP is meant by GDP at the national level

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Summary

Introduction

Gross Domestic Product (GDP) at the national and sub-national levels are the most widely used indicators for the analysis of economic performance and reference for political decision making. This paper aims at finding a good proxy for estimating economic performance at the national level using disaggregated regional GDP (GGP1) in Egypt. This paper hypothesizes that NTL can predict GDP at the national and sub-national levels, in Egypt It investigates if the intensity of night lights can be used as a proxy measure for the magnitude of the real GGP and GDP, during the period FY08-FY13. The paper replicates the work of Moursi and Omar (2016) at the sub-national level by using a different estimation method; “the Driscoll and Kray” method to check the robustness of their findings (Driscoll and Kraay, 1998; and Hoechle, 2007) It contributes, as the first paper, in examining the association between NTL and GDP in Egypt at the national level using disaggregated data 2 for 27 Egyptian governorates over 6 years (FY08-FY13).

What Is Nighttime Light?
Literature Review
GGP and NTL Evolution
Dataset Sources
Modeling the Relation between NTL and GGP
Can NTL Forecast GGP?
Findings
Conclusions
Full Text
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