Augmented Dickey-Fuller Unit Root Test Research Articles

A Panel Data Analysis on the Relationship between Financial Development and Economic Growth: The Case of Asian Countries

The causal relationship between economic growth and financial development is crucial for the dynamics of economic growth and the financial background it generates. However, doubts about the shape of the relationship may lead to indecision in the economic policies to be implemented. The aim of this study is to analyze and provide evidence on the relationship between the two variables in order to overcome this ambivalence. In this panel data analysis of 24 Asian countries covering the 2000-2020 period, firstly Cross-sectionally Augmented Dickey-Fuller (CADF) Unit Root Test, one of the second-generation unit root tests, and then Dumitrescu & Hurlin (2012) Panel Z_NT causality tests were applied. According to the causality test results, there is a bidirectional relationship between GDP and financial development. In addition, gross fixed capital formation (GFCF), which is included in the model as a control variable, is also found to have a bidirectional relationship with both variables. Thus, the evidence supporting the interaction view that combines supply and demand side theories reveals the importance of taking both variables into account in economic policy decisions.

Mineral resource rents, fintech technological innovation, digital transformation, and environmental quality in BRI countries: An insight using panel NL-ARDL

The prime objective of the current study is to investigate the impact of mineral resource rents, fintech technological innovation, and digital transformation on the environmental quality of 50 BRI countries. The panel data from the twenty years from 2000 to 2019 of the sample countries are used in the analysis of this study. The study has employed the Panel NL-ARDL to achieve the research objectives. Meanwhile, the current study has employed conventional unit root tests based on Augmented Dickey-Fuller (ADF) unit root tests, such as the LLC and IPS tests. This study employs the method of heterogeneous dynamic panel analysis. The results obtained from the FMOLS regression analysis provide a detailed comprehension of the complex connections between Mineral Resource Rent, Fintech, Digital Transformation, and CO₂ emissions; these findings indicate that countries with advanced financial technology or heavy reliance on Mineral resources are more likely to observe the favorable impacts of digital transformation on the environment. The study results imply that policymakers should investigate all-encompassing policies that exploit these interactions, recognizing that a complete approach can produce substantial and enduring environmental advantages. The interaction variables (NRRDTT and FNTINDTT) demonstrate the negative coefficients that emphasize the combined impact of Mineral resource rent, Finetch, and digital transformation. Policymakers in resource-dependent economies should consider strategies incorporating digitalization and financial technology to optimize their potential impact on environmental sustainability.

Small and medium scale enterprises and economic growth in Nigeria

Due to the inconclusive situation of empirical studies on Small and Medium Enterprises ( SMEs) and economic growth in Nigeria and the need to promote growth accompanied by poverty alleviation, this study examined SMEs financing and economic growth in Nigeria from 1999 to 2021. The hypotheses formulated and tested in the study included that there is no significant relationship between commercial bank loans, total credit to the private sector (which captures other means of financing SMEs) and lending rate. Annual data was collected from the Central Bank Statistical Bulletin. The augmented Dickey-Fuller unit root test revealed that the variables were stationary at the first difference, while the Johansen co-integration test indicated a long-run relationship among the variables. The Vector Error Correction Mechanism (VECM) indicated commercial bank loans have a weak negative effect on economic growth. Total credit to the private sector has a positive effect on economic growth, while lending rates have a significant negative effect on economic growth. It was concluded that SMEs financing has significant positive effects on economic growth in Nigeria. It was recommended that the government encourage more commercial bank loans to SMEs by guaranteeing such loans, more development bank branches should be established; and the lending rate should be lowered.

Natural gas, trade openness and economic growth in Peru: 1965–2022

Natural gas is a major fuel in Peru, accounting for nearly 45 % of all energy sources used to generate electricity. This research aims to analyze the dynamic association between economic growth and natural gas consumption (NGC), considering Peru's trade openness (Tr) from 1965 to 2022. The augmented Dickey–Fuller unit root test is utilized to test the stationary properties of the log series of real gross domestic product (GDP), NGC, and real Tr. We used the autoregressive distributed lag (ARDL) cointegration approach to determine the long-run (LR) equilibrium association between the variables. As the second cointegration method, we used the Engle-Granger test. The results of the ARDL test support the cointegration of all variables, we find the opposite case with Engle-Granger method. The Granger causality results support the neutrality hypothesis between GDP and NGC, a two-way causality association between Tr and GDP, and the neutrality hypothesis between NGC and Tr. Nevertheless, in the LR, cointegration confirms the growth hypothesis between GDP and NGC. Similarly, we find that in the LR, the first lag of Tr positively impacts the current GDP value. Meanwhile, in the short run, Tr has a positive effect on Peru's GDP. Then, using the findings of cointegration among all variables, we can conclude that NGC and Tr are the drivers of economic growth in Peru in the LR. Finally, we discuss the policy implications of our results.

The Nexus between Infrastructure Development and Agricultural Growth In Nigeria

The study examined the impact of infrastructure development on agricultural growth in Nigeria during the period 1990-2022. Key variables examined include public capital expenditure on economic services (PCEES), employment in agriculture (EMPA), research and development (RD), domestic credit to the private sector (DCPS), and agricultural output. Statistical analysis using the Ordinary Least Square (OLS) technique was employed, along with the Augmented Dickey-Fuller (ADF) unit root test to ensure the stationarity of the time series data, and the Johansen cointegration test to assess the long-run relationship between the dependent and independent variables. Our results show that all variables, except research and development, were stationary at first difference. The Johansen cointegration test conclusively demonstrated the existence of a long-run relationship in two cointegrating equations. Furthermore, the results from the Ordinary Least Squares (OLS) technique reveal that public capital expenditure on economic services, domestic credit to private sectors, and research and development were found to have a positive correlation with agricultural output in Nigeria. Conversely, employment in agriculture (EMA) was identified as having a negative effect on agricultural output in the country. The study recommends increasing investment in public capital expenditures on economic services. Moreover, establishing research institutes focused on agriculture in each state can provide valuable insights and solutions to boost the sector's productivity.

ANALYZING THE RELATIONSHIP BETWEEN HEALTH EXPENDITURE, RENEWABLE ENERGY AND LIFE EXPECTANCY: EVIDENCE FROM ASIAN COUNTRIES

This study investigates the relationship between health expenditures, renewable energy and life expectancy in Asian countries within a model covering the period 2000-2020. GDP data are also included in the model. In the study, after applying cross-sectional dependence test and Cross-sectional Augmented Dickey-Fuller unit root tests, panel cointegration test is employed to show whether there is a long-run mutual relationship between health expenditures and other variables, and then Dumitrescu-Hurlin (2012) panel causality analysis method is used to test the causality between the relevant variables in Asian countries. According to the empirical findings, while causality is found between health expenditures and renewable energy in most of the Asian countries, there is also a high level of causality between life expectancy and health expenditures. Moreover, the cointegration test between health expenditures and other variables confirms that there is a long-run relationship between the variables. It is concluded that policy makers in Asian economies should develop policy frameworks that provide opportunities for renewable energy consumption and support investment in renewable energy projects to promote the use of clean technologies. Thus, an increase in renewable energy consumption can lead to economic prosperity by not only improving quality of life but also increasing productivity.

Financial Development, Renewable Energy Consumption and Industrial Output Relation: Testing Fourier ARDL for Turkey

Abstract Energy plays a vital role in every aspect of the economy and in recent years renewable energy is highly debated for its pros and cons. While renewable energy consumption is important for sustainable growth and reduction of environmental damage it has some negative effects on the industrial production. The aim of the study is to examine the relationship between renewable energy consumption, financial development and industrial output for Turkey. Annual data between 1980 and 2019 were used in the study. Fractional Fourier Augmented Dickey-Fuller Unit Root Test and the Fourier Autoregressive Distributed Lag Bound Tests were used to analyze the relationship between variables. As a result of the study, a positive relationship was found between financial development and renewable energy consumption, while a negative relationship was found between industrial output and renewable energy consumption. Our empirical findings have important policy implications. According to these policy implications, the focus should be on a green-based economy with various subsidies, selective taxation procedures and incentive policies to increase the demand for renewable energy use.

Impact of Exchange Rate on Economic Growth: Evidence from Nigeria

The effect of the exchange rate on GDP growth in Nigeria from 1985–2021, according to this analysis. The World Bank's World Development Indicator (WDI) and the Central Bank of Nigeria's (CBN) Statistical Bulletin were used as secondary sources of data. The real exchange rate served as a stand-in for the actual exchange rate, while real gross domestic product was used to gauge economic growth. We used the Augmented Dickey-Fuller unit root test to find out how integrated the series was. The bound test was used to test for cointegration. The bound test found that the exchange rate and economic growth are related in the long term. This research used the autoregressive distributed lag technique to estimate the short- and long-term effects of the exchange rate on GDP growth. The ARDL analysis shows that there is a weak negative correlation between the exchange rate and GDP growth. According to the research, trade openness has a small but favorable effect on GDP growth. Furthermore, the research indicated that foreign exchange reserves significantly and positively impacted economic development. There was also a negative and statistically significant relationship between interest rates and GDP growth. The analysis found that the exchange rate did not have a significant role in determining Nigeria's economic development. Given the importance of a stable and predictable exchange rate in boosting economic development, the research suggests that monetary authorities implement a policy primarily aimed at stabilizing exchange rates.

Macroeconomic effects of government infrastructural expenditure on economic growth in Nigeria

It is replete in the economic literature that government expenditure on infrastructure affects economic growth positively. But some empirical studies have found a contradictory result in many countries. This study, therefore, examines the macroeconomic effects of government infrastructural expenditure on economic growth in Nigeria from 1981-2021. The objectives of the study are to determine the macroeconomic effects of government expenditure on transport and communication system, education, health, and road and construction on economic growth in Nigeria. The study utilized annual time series data on real gross domestic product (RGDP) and selected explanatory variables which include: government expenditure on transportation and communication, government expenditure on education, government expenditure on health and government expenditure on road and construction. The study adopted the autoregressive distributed lag (ARDL) data analysis technique based on augmented Dickey-Fuller unit root test which indicates that the variables are integrated of I(0) and I(1). Findings reveal that, in the long run, while government expenditure on health, and road and construction have significant but negative and positive effects on real gross domestic product respectively, government expenditure on transportation and communication, and education have positive and insignificant effects on real gross domestic product in Nigeria. The short run findings produced mixed results with one striking revelation that previous value of RGDP (RGDP at lag 1) generates positive effect on RGDP. The study, therefore, concludes that government expenditure on infrastructure affects economic growth in Nigeria within the period under review, and recommends that rational allocation and effective management of public funds should be made on infrastructure with strict supervision of approved public projects.

The impact of tax revenue on economic growth in Nigeria

This research aimed to investigate the influence of tax revenue on Nigeria's economic growth over a three-decade period spanning from 1991 to 2021. The tax data was collected from the Federal Internal Revenue Service (FIRS) and the Nigerian Bureau of Statistics (NBS), while economic data for Nigeria was sourced from the 2021 Statistical Bulletin of the Central Bank of Nigeria (CBN). The study utilized personal income tax (PIT), corporate income tax (CIT), and value-added tax (VAT) as proxies for tax revenue, with gross domestic product (GDP) serving as the dependent variable to represent the Nigerian economy. Several diagnostic tests were conducted, including a descriptive statistic to assess data normality and the Augmented Dickey-Fuller unit root test to evaluate data stability. The Autoregressive Distributed Lag (ARDL) technique was employed as the statistical tool for data analysis, utilizing E-View version 9 as the statistical package. The findings from the ARDL test revealed that personal income tax (PIT) and value-added tax (VAT) had a negative impact on GDP, while company income tax (CIT) showed a positive impact. As a result, the study concluded that tax revenue exhibits a positive and significant correlation with the growth of the Nigerian economy. The study suggests that governments and relevant tax authorities should focus on increasing taxes as a revenue source and target sectors that drive economic growth.

Javno obrazovanje, stalni rashodi i produktivnost u industrijskom sektoru u Nigeriji

The debate on whether governments should increase their human capital investment is a popular topic within the realm of economics. This research seeks to solve this issue by looking into the importance of productivity in the manufacturing output as well as the function of productive expenditure. The study examines how the recurrent expenditure of public education in Nigeria between 1981 and 2019 affected manufacturing productivity. The study employed the Augmented Dickey-Fuller (ADF) unit root test and Auto Regressive Distributive Lags (ARDL) approach to analyse the relationship between public education recurrent expenditure, public health spending, trade openness, inflation rate, and the output of the manufacturing sector. The study reveals that public education recurrent expenditure is not significantly associated with manufacturing productivity. According to the study, the government should also concentrate on implementing policy frameworks aimed at improving manufacturing sector productivity by targeting public recurrent education spending.

The resource curse in least developed countries: The roles of foreign direct investment, energy efficiency, and electricity access

Extensive research exists on the link between natural resource rents and GDP growth, yet the roles of Foreign Direct Investment (FDI) and energy efficiency are less studied. As such, this study aims to bridge this research gap by investigating the relationship among natural resource rents, FDI, and GDP growth in the context of the Least Developed Countries (LDCs). In addition, the potential influences of energy efficiency and electricity access are considered. Using time-series methodologies like the Augmented Dickey-Fuller (ADF) unit root test with structural breaks, Bayer-Hanck Cointegration, and regression methods such as FMOLS, DOLS, and CCR, the study explores the defined variables. Robustness checks are conducted using Robust and Simple Least Squares without breaks. The results reveal that most variables, barring mineral rents and long-run cointegration between growth and explanatory variables, are stationary at first difference D(1). Findings show that LDCs are susceptible to the resource curse, with forest and mineral rents and FDI negatively impacting economic growth. However, enhanced energy efficiency and electricity access can foster sustained growth in LDCs. The robustness check results corroborate the primary findings. The study concludes by proposing policy recommendations for sustainable resource use, regulation of FDI, and improving energy efficiency and electricity access.

Contribution of Indirect Taxes on Goods to Economic Growth of Pakistan (1972-2022)

PURPOSE Economic growth is influenced by the changes in indirect taxes imposed by the government on the production/consumption of goods. This paper aims to identify the empirical relationship between indirect taxes – i.e., federal sales tax, federal excise duty, and customs duty – and the economic growth of Pakistan. METHODOLOGY For this purpose, annual time series data from 1972 to 2018 are used. The objective of the study is to evidence the long-run and short-run relationships of federal sales tax, federal excise duty, and customs duty with economic growth. The Augmented Dickey-Fuller unit root tests are used to check the stationarity of each variable. The Johansen Cointegration Test is performed to identify the cointegration among variables. The Vector Error Correction Model (VECM) is used to estimate the long-run and short-run relationships among these variables. FINDINGS The results of the study show that there are two cointegrating equations among variables. GDP Lag5, GDP Lag6, ST Lag1, ST Lag5, and FE Lag4 possess a positive impact on the economic growth of Pakistan. However, GDP Lag2, FE Lag6, and CD Lag7 have a negative impact on the economic growth of Pakistan. Previous years’ deviations from long-run equilibrium are corrected in the current year at an adjustment speed of 33% and 18% for GDP and ST, respectively. CONTRIBUTION/IMPLICATIONS Since the sales tax has a positive impact on economic growth, whereas federal excise duty and customs duty have a negative relation, it is advisable to form policies that contribute to economic growth instead of restricting it. As of the published statistical records of 2018, sales tax, federal excise duty, and customs duty contribute 65 per cent, 9 per cent, and 26 per cent, respectively, to the total indirect taxes. This collection structure is required to be rationalised to boost economic growth.

Nigeria’s Inflation in the Era of Liquefied Natural Gas Exports: Insights from 2000-2021 ARDL Cointegration Analysis

This paper presents a comprehensive analysis of the impact of Liquefied Natural Gas (LNG) exports on inflation in Nigeria over the period 2000–2021. Utilizing the Autoregressive Distributed Lag (ARDL) bound co-integration approach, the study investigated both long-term and short-term relationships between LNG exports, natural gas prices, crude oil prices, and inflation in Nigeria. The Augmented Dickey-Fuller (ADF) unit root test indicated a mixed order of integration for the variables, suggesting the appropriateness of the ARDL cointegration method. The empirical results revealed the presence of a long-term relationship among these factors. In the long term, LNG exports, natural gas prices, and crude oil prices exhibited varying effects on inflation. While natural gas prices and crude oil prices had a statistically significant adverse impact on inflation at a 5% significance level, LNG exports did not show statistical significance. In the short term, LNG exports displayed both a negative and statistically insignificant influence, whereas crude oil prices had a positive and statistically significant effect. Natural gas prices, on the other hand, did not impact inflation significantly in the short term. The Granger causality tests revealed that there is no causal relationship between LNG exports and inflation in Nigeria. Although the influence of LNG exports on inflation lacks statistical significance, it is recommended that the government continue its commitment to the LNG sector, focusing on infrastructure and technology investments to enhance competitiveness and efficiency. Expanding into new markets and diversifying the LNG portfolio will ensure a steady revenue stream while prioritising economic diversification beyond the oil and gas sector

Bank Credits and Economic Growth

This study examined the effect of bank credit on the growth of the Nigerian economy. The study was specifically meant to assess the impact of bank credit to the agricultural sector on the growth of the Nigerian economy; to determine the effect of bank credit to the manufacturing sector on the growth of the Nigerian economy and lastly to assess the effect of bank credit to the mining and quarrying sector on the growth of the Nigerian economy. To achieve these objectives, the study employed the ex-post facto research approach. Time-series data were collected from the CBN Statistical Bulletins using the desk survey method from 1985 to 2018. The data were analysed using various econometric techniques such as the descriptive statistics test, the Augmented Dickey-Fuller (ADF) unit root test, Correlation matrix, and Autoregressive Distributive Lag (ARDL). Findings from the analyses showed that there was an insignificant short-run effect of bank credit on the growth of the Nigerian economy. It was also revealed that there was a significant long-run effect of bank credit on the growth of the Nigerian economy. Based on these findings, the study recommend the establishment of an agency were all commercial farmers would be registered with responsibilities to interface with banks to ensuring that loans are free from collateral requirements, interest rate charges and loan administration bottlenecks in order to encourage commercial farming and towards enhanced economic growth in Nigeria. Also, policies targeted at reducing the interest rate charged on bank credit to the manufacturing sector in Nigeria should be implemented by the CBN through the conscious subsidy of all bank credit to the manufacturing sector as this is required to trigger productivity and enhance short term economic growth.

Crude Oil Export Earnings and Economic Growth in Nigeria

The crude oil sector is one of the main sectors saddled with the potential to employ a large segment of the population and is an essential key to the sustenance of the economic growth of countries. This study presented an empirical analysis of the impact of crude oil export earnings on economic growth in Nigeria spanning the period of 1981 - 2020. The model built for the study was the proxied Real Gross Domestic Product (RGDP) as the endogenous variable measuring economic growth as a function of Crude Oil Export (OEX), while Exchange Rate (EXR), Trade Openness (TOP) and Transportation Cost (TPC) were the exogenous variables. The annual time series data were gathered from CBN Statistical Bulletin, and the World Development Indicator (WDI). The study used econometric techniques of Augmented DickeyFuller (ADF) unit root test, Johansson co-integration, error correction model and Granger causality for empirical analysis. The results of unit root suggested that RGDP, OEX, EXR TOP, and TPC were stationary at first difference. The Johansson co-integration showed a long-run relationship among the variables. The findings from the ECM showed that crude oil exports have a positive and significant impact on the Nigerian economy. The study recommended that the activities by the government in promoting economic growth and development in the country should be geared towards promoting and developing the Oil export base of the country as it has a significant relationship with economic growth.

A Conceptual Analysis of Price Movement, Stock Determinants and Their Effects on Economic Growth in Nigeria

This study explores the effects price movements in stocks and its determinants on growth in Nigerian economy. The study in specific terms model’s stock price fluctuations against economic growth and insecurity, exchange rate, interest rate, inflation rate, stock price movement against GDPGR in Nigeria. To achieve the above objectives, the study employs the ex-post facto research design. Quarterly time series data were obtained from the Central Bank of Nigeria (CBN) statistical Bulletins using already available data from 1985 - 2019. The data were analyzed via the aids of econometric techniques such as the descriptive statistics test, the Augmented Dickey-fuller (ADF) unit root test, Correlation matrix and Heteroskedasticity ARCH effect, granger causality, the GARCH (1,1) model and ARDL model for estimations. Findings from the analysis shows price fluctuations had positive and significant effect on growth of the Nigerian Economy. Also, it was opined that insecurity, interest rate, inflation rate, exchange rate, and GDPGR have long-run significant effects on share price volatilities in Nigeria. Finally, it was revealed insecurity, interest rate, inflation, exchange rate and GDPGR have a long-run significant effects on share price fluctuations in Nigeria. On the bases of this finding studies recommended that Authority through its agencies should formulate working document that would stabilize macroeconomic variables and by extension reduce the fluctuation of the stock price as this is required to enhance confidence amongst investors in the market. Also, that the CBN should design and implement policy instruments that would stabilize interest rate to promote significant short run investments and sustain the long run benefits of investments in Nigeria. Government should expedite efforts to reduce the rate of inflations and stabilize the price of goods and services as this promises greater savings and encourages investments which will translate into economic growth. Lastly, policies to tackle cases of corruption in the security framework should be formulated, while the Government should be proactive about its fight against insecurity in Nigeria as this would help stabilize share prices and enhance economic growth in Nigeria.

Investigating Asymmetric Effects of Electronic Payment on Money Supply for India using Non-linear ARDL Model

Money supply in India is analysed using a non-linear autoregressive distributed lag (NARDL) model to see how several factors, such as electronic payments, exchange rate, interest rates and inflation, affect the money supply. The Augmented Dickey–Fuller unit root test and the Phillips–Perron unit root test are utilized to confirm that the variables are stationary. In the bounds test of the NARDL as well as Johansen–Juselius cointegration test, this study finds evidence of cointegration amongst variable used in the study. NARDL testing model is employed to investigate the dissimilar influences on variables with short- and long-run dynamics. Short-term estimates suggest that the money supply ( M1) is most responsive to positive shocks involving retail payments, the exchange rate and interest rates, but negative shocks involving card payment and prepaid payment instruments. A reduction in card payment, as well as a positive increase in retail payment, the prepaid payment instrument, the exchange rate and the interest rate, would all have major effects on M3 in short run. In addition, a long-term finding demonstrates that all of the variables have a significant influence on the money supply ( M1) in its mixed form while all of the factors, with the exception of the one involving card payments, have a considerable impact on the money supply ( M3). Wald test results confirm the existence of asymmetric influences which can have significant lessons for policymakers.

Liquidity Risk Management Practices and Profitability of Banking Firms in Nigeria

Objective: The objective of this research is to examine how liquidity risk management practices impact the profitability of Nigerian banking institutions. The study utilizes panel data from 1960 to 2021 for analysis. Methods: The study employed financial time series methodology and based on the results of the descriptive analysis and augmented Dickey-Fuller unit root tests for stationarity, the authors employ the Johansen co-integration test to establish the long-run effect of liquidity risk management practices alongside other control factors on profitability of banking firms in Nigeria. The study also examines the short-run relationship between liquidity risk management practices and profitability by estimating the ordinary least square. Results: Based on the result of the descriptive statistics, it is evident that there is a positive relationship between the variations in the mean of the net profit for each of the banks. This result indicates that most of the banks recorded a profit for the year under review. The econometric results show that the current ratio of the banks was within the range of 1.74 to 2.49 indicating that most of the banks under study are well within the desired range and not overstretched as they may not meet the demand of their depositors for withdrawals in the near future. The coefficient of cash ratio in the random effect model is statistically insignificant which indicate that its impact is negligible on the profit margin of the commercial banks. With an R-square value of 0.66, it can be concluded that 66% of the variation in the dependent variable is explained by the independent variables used in the model. The coefficients of the current ratio and cash ratio were statistically insignificant and negatively related to net profits of the banks, this result implies that current and cash ratios have a limited impact on net profits. Conclusion: In conclusion, most Nigerian commercial banks have adequate financial resources to meet their current liabilities this is because they are well capitalized.

The impact of marine industrial structure rationalization on marine economic growth

As an important part of the world economy today, the marine economy is of great significance for promoting economic growth and sustainable development. To better promote the development of marine economy, the Augmented Dickey-Fuller (ADF) unit root test was first used to test the stationarity of marine economy related variables to ensure the reliability of the model. Then, the Vector Error Correction Model (VECM) is used to analyze the long-term stable relationship and short-term dynamic adjustment relationship between the marine industrial structure rationalization and the marine economic growth. These results reveal the mechanism of the influence of the rationalization of marine industrial structure on the growth of marine economy. It is found that among the eastern coastal provinces and cities, the rationalization level of marine industrial structure in Shanghai is up to 0.163 points, which is higher than other cities. The main reasons are the low specialization index of marine labor force, the comprehensive utilization amount of industrial waste in 10,000 yuan of gross marine product, the low environmental protection index, and the large gap between the benefits of each index. In addition, the study also found that the Granger causality test values of the delayed combination of variables Gross Ocean Product (GOP), ts, GOP, and ts were 5.531, 14.672, and 15.069, respectively. Finally, it is found that the upgrading of marine industrial structure and the output of marine economy will correct the deviation of industry rationalization below the equilibrium value in the short term at a rate of 0.1675. According to the above results, the study puts forward the following suggestions. First, it needs to strengthen the planning and layout of the marine industry, rationally guide the allocation of resources and industrial development. Second, it needs to increase support for scientific and technological innovation, and promote technological progress and industrial upgrading. The third is to strengthen the government's policy support and supervision to provide a stable policy environment and market environment for industrial development. The innovation lies in the systematic study of the relationship between the rationalization of marine industrial structure and the growth of marine economy.