Abstract
The paper investigates the export-led growth hypothesis for four South Asian countries e.g. Bangladesh, China, India and Myanmar (BCIM) using PMG regression technique and Pairwise DH Panel Causality tests over the years 1980-2017. Employing the bivariate (GDP and exports), the trivariate (GDP, exports and exchange rate; and the multivariate (GDP, exports, exchange rate and gross government consumption expenditure and investment) models, the study finds that exports have positive impact on the GDP growth in all BCIM economies in the long run. However, DH Panel Causality tests show bidirectional causal relationship between exports and GDP, implying that export-led growth hypothesis is stable in BCIM economies. In this backdrop, policy makers of these countries should continue the existing momentum of export promotion and search for new destinations by diversifying both export markets and commodities including services to reach spectacular growth trajectory.
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