The Evolution of Export-Led Growth: Comparative Insights from the E7 Economies

Abstract This study is to examine the relationship between exports, debt, and economic growth in the E7 economies. Using two distinct causality analyses for comparison on latest statistics from 1992 to 2024 taken from the World development indicators (WDI). The panel granger causality results shows that a bi-directional causality occurs between economic growth (EG) and exports at 2nd and 3rd lag lengths. The panel frequency domain causality approach reveals a bi-directional temporary, medium, and permanent causality between economic growth to exports, and economic growth to debt. This linkage provides proof supporting the feedback hypothesis for the E7 economies. The results of this research pave the way for policymakers and groups to adopt a positive stance regarding debt and GDP growth compared to the E7 economies. It suggested that sustainable growth can be achieved with appropriate policies to regulate activities in these economies. JEL Classification: F34 · O11 · O20