Assessing Economic Takeoff and Growth in the Arab World An Econometric Study (1990–2023)
Main Article Content
Abstract
Economic takeoff is a critical phase in the development of emerging economies, signifying a transition towards sustained economic growth. This study assesses the relationship between economic takeoff and economic growth in 11 Arab countries from 1990 to 2023 using econometric methods. Employing panel unit root tests, the Pedroni cointegration test, and the Fully Modified Ordinary Least Squares (FMOLS) estimation technique, the study examines the long-term equilibrium relationships between investment, capital accumulation, foreign trade, and economic growth. The findings reveal that economic takeoff is characterized by overcoming structural constraints through investment and capital formation. The study confirms that investment, capital accumulation, and trade balance positively and significantly influence economic growth, highlighting the need for policies that enhance infrastructure, financial systems, regional trade integration, and human capital development to sustain long-term economic expansion in Arab economies.
Article Details
Section
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Once the manuscript is accepted for publication, authors shall transfer the copyright to the publisher. If the submitted manuscript is not accepted for printing by the journal, the authors shall retain all their rights. The following rights on the manuscript are transferred to the publisher, including any supplementary materials and any parts, extracts or elements of the manuscript:
- the right to reproduce and distribute the manuscript in printed form, including print-on-demand;
- the right to print prepublications, reprints and special editions of the manuscript;
- the right to translate the manuscript into other languages;
- the right to reproduce the manuscript using photomechanical or similar means including, but not limited to photocopy, and the right to distribute these copies;
- the right to reproduce and distribute the manuscript electronically or optically using and all data carriers or storage media, and especially in machine readable/digitalized form on data carriers such as hard drive, CD-ROM, DVD, Blu-ray Disc (BD), Mini Disc, data tapes, and the right to reproduce and distribute the article via these data carriers;
- the right to store the manuscript in databases, including online databases, as well as the right to transmit the manuscript in all technical systems and modes;
- the right to make the manuscript available to the public or to closed user groups on individual demand, for use on monitors or other readers (including e-books), and in printable form for the user, either via the Internet, online service, or via internal or external networks.
References
Acemoglu, D., & Robinson, J. A. (2006). Economic origins of dictatorship and democracy. Cambridge University Press.
Acs, Z. (2006). How is entrepreneurship good for economic growth? Innovations, 1(2), 97-107.
Agu, S. C., Onu, F. U., Ezemagu, U. K., & Oden, D. (2022). Predicting gross domestic product to macroeconomic indicators. Intelligent Systems with Applications, 14, 200082. https://doi.org/10.1016/j.iswa.2022.200082.
Alfalih, A. A. (2024). The impact of oil prices, foreign direct investment and trade openness on unemployment rates in an oil-exporting country: The case of Saudi Arabia. Heliyon, 10(3), e25094. https://doi.org/10.1016/j.heliyon.2024.e25094.
Banday, U. J., Murugan, S., Maryam, J., & Ridwan, M. (2021). Foreign direct investment, trade openness and economic growth in BRICS countries: Evidences from panel data. Transnational Corporations Review, 13(2), 211-221. https://doi.org/10.1080/19186444.2020.1851162.
Barro, R. J. (1991). Economic growth in a cross section of countries. The Quarterly Journal of Economics, 106(2), 407–443. https://doi.org/10.2307/2937943.
Bashier, A.-A., & Siam, A. J. (2014). Immigration and economic growth in Jordan: FMOLS approach. International Journal of Humanities Social Sciences and Education (IJHSSE), 1(9), 85–92. https://www.arcjournals.org.
Berthélemy, J.-C., & Söderling, L. (1999). The role of capital accumulation, adjustment, and structural change for economic take-off: Empirical evidence from African growth episodes (OECD Development Centre Working Papers, No. 150). OECD Publishing. https://doi.org/10.1787/518867170562.
Bouharb, H., & Belkharchouche, I. (2021). The nature of economic takeoff and the conditions for its achievement. In Opportunities and challenges of achieving economic takeoff in Algeria in light of the negative repercussions of the COVID-19 pandemic (pp. xx–xx). Souk Ahras University, Economic Studies Research Laboratory Publications.
Carlsson, M., Lyhagen, J., & Österholm, P. (2007). Testing for purchasing power parity in cointegrated panels (IMF Working Paper No. WP/07/287). International Monetary Fund.
Doran, J., McCarthy, N., & O’Connor, M. (2018). The role of entrepreneurship in stimulating economic growth in developed and developing countries. Cogent Economics & Finance, 6(1). https://doi.org/10.1080/23322039.2018.1442093.
Emako, E., Nuru, S., & Menza, M. (2022). The effect of foreign direct investment on economic growth in developing countries. Transnational Corporations Review, 14(4), 382–401. https://doi.org/10.1080/19186444.2022.2146967.
Gibson-Graham, J. K., Cameron, J., & Healy, S. (2013). Take back the economy: An ethical guide for transforming our communities. University of Minnesota Press. https://doi.org/10.5749/minnesota/9780816676064.001.0001.
Grant, C. (2017). The contribution of education to economic growth. K4D Helpdesk Report. Institute of Development Studies.
Hanushek, E. A. (2013). Economic growth in developing countries: The role of human capital. Economics of Education Review, 37, 204–212. https://doi.org/10.1016/j.econedurev.2013.04.005.
Hausmann, R., Rodrik, D., & Velasco, A. (2005). Growth diagnostics. Harvard University Center for International Development Working Paper No. 03. https://doi.org/10.2139/ssrn.979850.
Hossain, M. S., Voumik, L. C., Ahmed, T. T., Alam, M. B., & Tasmim, Z. (2024). Impact of geopolitical risk, GDP, inflation, interest rate, and trade openness on foreign direct investment: Evidence from five Southeast Asian countries. Regional Sustainability, 5(4), 100177. https://doi.org/10.1016/j.regsus.2024.100177.
Ismail, N. W., & Mahyideen, J. M. (2015). The impact of infrastructure on trade and economic growth in selected economies in Asia. ADBI Working Paper Series, No. 553. https://doi.org/10.2139/ssrn.2709294.
Jie, Y., & Lan, J. (2024). Dynamic linkages between human capital, natural resources, and economic growth – Impact on achieving sustainable development goals. Heliyon, 10(14), e33536. https://doi.org/10.1016/j.heliyon.2024.e33536.
Khan, M. T. I., Anwar, S., Sarkodie, S. A., Yaseen, M. R., & Nadeem, A. M. (2023). Do natural disasters affect economic growth? The role of human capital, foreign direct investment, and infrastructure dynamics. Heliyon, 9(1), e12911. https://doi.org/10.1016/j.heliyon.2023.e12911.
Koopman, E., & Wacker, K. M. (2023). Drivers of growth accelerations: What role for capital accumulation? World Development, 169, 106297. https://doi.org/10.1016/j.worlddev.2023.106297.
Laacab, M. (2015). Economic growth and convergence: An econometric study of the mechanisms for achieving growth and economic convergence in a group of developing countries during the period (1985-2012) (Doctoral dissertation). National School of Statistics and Applied Economics (ENSSEA).
Levine, R., & Renelt, D. (1992). A sensitivity analysis of cross-country growth regressions. The American Economic Review, 82(4), 942–963.
Lucas, R. E. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22(1), 3–42. https://doi.org/10.1016/0304-3932(88)90168-7.
Maccelli, F., & van Leeuwen, M. H. D. (2025). Deciphering long-term labor skill development in Italy, 1871–2011. Social Science History, 1–30. https://doi.org/10.1017/ssh.2025.11.
Mankiw, N. G., Romer, D., & Weil, D. N. (1992). A contribution to the empirics of economic growth. The Quarterly Journal of Economics, 107(2), 407–437. https://doi.org/10.2307/2118477.
Meka’aa, C. B., Fotso, S. R., & Kamdem, B. R. G. (2024). Investments in basic public infrastructure and their effects on economic growth in a developing country: The case of Cameroon. Heliyon, 10(4), e26504. https://doi.org/10.1016/j.heliyon.2024.e26504.
Mitić, P., Munitlak Ivanović, O., & Zdravković, A. (2017). A Cointegration Analysis of Real GDP and CO2 Emissions in Transitional Countries. Sustainability, 9(4), 568. https://doi.org/10.3390/su9040568.
Naito, T. (2022). Does a larger country set a higher optimal tariff with monopolistic competition and capital accumulation? Economics Letters, 216, 110566. https://doi.org/10.1016/j.econlet.2022.110566.
Pakrashi, D., & Frijters, P. (2017). Takeoffs, landing, and economic growth. ADBI Working Paper Series, No. 641.
Palei, T. (2015). Assessing the impact of infrastructure on economic growth and global competitiveness. Procedia Economics and Finance, 23, 168-175. https://doi.org/10.1016/S2212-5671(15)00322-6.
Qayyum, A., Arslan, A., Malik, A. H., Khan, S. N., Rehman, A. U., Asim, M., Ahmad, S., & ElAffendi, M. A. (2025). Financial innovation can hamper the sustainable economic growth: A tale of two emerging economies. Journal of Open Innovation: Technology, Market, and Complexity, 11(1), 100446. https://doi.org/10.1016/j.joitmc.2024.100446.
Romer, P. M. (1990). Endogenous technological change. Journal of Political Economy, 98(5, Part 2), S71–S102. https://doi.org/10.1086/261725.
Rostow, W. W. (1956). The take-off into self-sustained growth. The Economic Journal, 66(261), 25-48. https://doi.org/10.2307/2227401.
Rostow, W. W. (1960). The stages of economic growth: A non-communist manifesto. Cambridge University Press.
Sachs, J. D. (2005). The end of poverty: Economic possibilities for our time. Penguin Press.
Saidi, Y., & Ochi, A. (2023). Estimating relationships among foreign direct investment, governance quality, and economic growth in developing countries using the threshold auto-regressive model. Regional Science Association International. https://doi.org/10.1111/rsp3.12654.
Sekine, T. (2022). Looking from gross domestic income: Alternative view of Japan’s economy. Japan and the World Economy, 64, 101159. https://doi.org/10.1016/j.japwor.2022.101159.
Smith, M. (1960). On Rostow’s ‘stages’ thesis and explanation of ‘take-off’ growth. University of Sydney.
Tellis, G. J., Stremersch, S., & Yin, E. (2003). The international takeoff of new products: The role of economics, culture, and country innovativeness. Marketing Science, 22(2), 188-208. https://doi.org/10.1287/mksc.22.2.188.16041.
Temsumrit, N. (2023). Can aging population affect economic growth through the channel of government spending? Heliyon, 9(9), e19521. https://doi.org/10.1016/j.heliyon.2023.e19521.
Traoré, M. (2022). Infrastructures et croissance économique : cas du Mali [Infrastructure and economic growth: The case of Mali]. International Journal of Accounting, Finance, Auditing, Management & Economics, 3(2-2), 118-138. https://doi.org/10.5281/zenodo.6382729.
Ullah, W., Zubir, A. S. M., & Ariff, A. M. (2024). Exploring the moderating effect of regulatory quality on the relationship between financial development and economic growth/economic volatility for developed and developing countries. Borsa Istanbul Review, 24(5), 934-944. https://doi.org/10.1016/j.bir.2024.04.015.
Vishandass, A. (2022). Economic growth & development short answers. PKP-08, IIPA.
Voumik, L. C., Rahman, M. H., Rahman, M. M., Ridwan, M., Akter, S., & Raihan, A. (2023). Toward a sustainable future: Examining the interconnectedness among Foreign Direct Investment (FDI), urbanization, trade openness, economic growth, and energy usage in Australia. Regional Sustainability, 4(4), 405-415. https://doi.org/10.1016/j.regsus.2023.11.003.
Young, A. (1995). The tyranny of numbers: Confronting the statistical realities of the East Asian growth experience. The Quarterly Journal of Economics, 110(3), 641–680. https://doi.org/10.2307/2946695.