Banking Academy of Vietnam

International School of Business

ECONOMETRICS
FACTORS AFFECTING ECONOMIC GROWTH IN US IN
THE PERIOD OF 1970-2015

Lecturer: Mrs. Đinh Thanh Bình

Student:

Phạm Mai Phương – CA8-029– 100%

Phùng Thị Thanh Hương– CA8-126-100%

Đoàn Thị Thảo Linh – CA8-058 – 100%

Phạm Thị Hồng Diệp – CA8-093 – 100%

Nguyễn Thu Uyên – CA8-048 – 90%

Class: CityU8D

Course: Econometrics

Ha Noi, 17 May 2022

CONTENT
Introduction ..............................................................................................................2
I. Theoretical and practical basics of economic growth……………………...2

1. The definition of economic growth.............................................................3

2. Measuring economic growth ......................................................................3

3. Literature review..........................................................................................3

II. Research methodology and econometric model............................................4

1. Model building method.................................................................................4

2. Building econometric models………………………………………………4

2.1 Overall model……………………………………………………………….….5

2.2. A random sample regression model…………………………………….…..…5

3. Description of the data…………………………………………………..…6

4. Statistics description of variables…………………………………….….….7

III. Estimation of Econometric Model……………………………………….……10

1. Regression model……………………………………………………….….10

2. Check the suitability of the model………………………..……………...…12

3. Examination of disability regression result ……………...…………..…...13

3.1. Multicollinearity……………………………………………………,…13

3.2. Heteroskedasticity ……………………………………………….…….14

4. Hypothesis Testing…………………………………………………….…...15

4.1. Critical value……………………………………..……………………..15

4.2. Confidence interval……………………………..………………………17

IV. Result analysis & policies implication…………………………………………19

CONCLUSION….…………………………………………………………………21
REFERENCES..…………………………………………………………………...22
Appendix…………………………………………………………………………...23

1
 INTRODUCTION

Economic growth is the top goal of countries in the world, a measure of

progress in each stage of each country. The United States - a power with a mixed
economy of many sectors, plays an important role and exerts great influence on the
global market. After World War II, the US economy grew by leaps and bounds thanks
to effective government regulation and many outstanding achievements in the second
scientific and technical revolution. The Great Recession of the Global Economy in
2008 with the center of the crisis was the United States, causing the country's economy
to fall into a serious state of stagnation. Only 5 years later, the US economy could
revive and stabilize again. Currently, the United States is one of the richest countries
(in terms of GDP), holding an economic advantage in the whole world. It can be said
that the success in US economic growth has been astounding. In order to answer the
question: So what contributed to the impact on that breakthrough growth?, our group
decided to choose the topic: “Factors affecting economic growth in the US in the
period 1970 - 2015” to make a report for Econometrics.

The report's overall goal is to examine the impact of macroeconomic factors

such as Consumer Price Index , total export value , total Domestic Savings, Foreign
Investment outflows, Government Spending and the dependent variable (GDP). There
are several specific goals in this report. Firstly, the system lays out the theory and prior
research on the impact of several factors on economic growth. Secondly, calculate the
regression function model and examine the variables' influence on GDP. Verify and
rectify the estimated model's flaws. Finally, discuss and propose various strategies to
influence the aforesaid macro variables and therefore United States’s economic
growth.

I. Theoretical and practical basic of economic growth

1.The definition of economic growth

2
Economic growth is the increase in gross domestic product (GDP) or gross national
product (GNP) or the size of national output per capita (PCI) over a given period of
time.

2. Measuring economic growth

To measure economic growth can use absolute growth, economic growth rate or
average annual growth rate for a period.

The absolute growth rate is the difference in economic size between the two periods to
be compared.

The GDP growth rate is calculated by the formula:

Real GDP is real GDP calculated using the formula:

Since the level of inflation will be different each year, it is necessary to divide by the
price index to get the correct real GDP.

The size of an economy is expressed in terms of gross domestic product or gross

national product (GNP) or income per capita.

If economic size is measured in nominal GDP (or GNP), then there will be nominal
GDP (or GNP) growth. And vice versa, if economic size is measured in real GDP (or
GNP), then there will be real GDP (or GNP) growth. Usually, economic growth uses
real rather than nominal indicators.

3. Literature review

Economic growth is the increase of real GDP or GDP, an increase of national product
that is measured in constant prices ( Denison,1962). However, the factors that
influence each component's increase are highly diverse. Boldeanu and Constantinescu
(2015) show that public spending, capital formation, private or public investment,
employment rate, exchange rate, and other determinants of economic growth have

3
different effects on growth, and that these determinants have different meanings
depending on whether or not countries develop. There are other socio-political
elements and events that have a significant impact on a country's economic
development.

Robert Barro (1996) looked at a group of 100 countries from 1960 to 1990 to see what
factors influenced their economic growth. He discovered that maintaining the rule of
law, smaller government consumption, longer life expectancy, more male secondary
and higher levels of schooling, lower fertility rates, higher levels of investment,
democracy, lower inflation, and trade openness were all linked to real per capita GDP
growth. He also stressed the convergence theory, which states that when real GDP
rises, the growth rate decreases.

In some nations, Malik and Chowdhury (2001) discovered a positive and significant
link between CPI and GDP. This result indicates that moderate inflation boosts
productivity and output. Meanwhile, based on impulse response analysis, data from a
survey of 39 economies on the relationship between export growth and GDP showed
that export growth has a positive cumulative effect on GDP growth (M. Pereira & Xu,
2000)

Based on previous studies, we decided to choose 5 variables for the model, including:
Dependent variable: Gross Domestic Product GDP (Unit: billion USD)

Independent variables: Consumer Price Index CPI, total export value EX, total
Domestic Savings SAVING, total domestic private investment INV, Government
Spending GOV.

II. Research methodology and econometric model

1. Model building method

Regression analysis method: test hypotheses about the relationship between two or
more variables, including one dependent variable and one or more independent
variables by using OLS coefficient estimation method. Specifically, this study
analyzes the relationship between the independent variable (Consumer Price Index ,

4
total export value , total Domestic Savings, total domestic private investment ,
government Spending) and the dependent variable (GDP).

2. Building econometric models

Our team opted to employ multiple regression analysis to determine the relationship of
GDP dependent variables for 5 independent variables (CPI, EXP, SAVING, INV,
GOV) with period from 1960 to 2015 after analyzing and referring to previous works.

The model consists of 5 variables:

- Dependent variable: Y Gross domestic product GDP (Unit: USD)

- Independent variables: X

Consumer Price Index CPI ( Unit: Index)

Total export value EX ( Unit: % of GDP)

Total Domestic Savings SAVING (Unit: % of GDP)

Total domestic private investment INV (Unit: % of GDP)

Government Spending GOV (Unit: % of GDP)

2.1 Overall model

(PRF) GDP= β1+β2 EX+β3SAVING+β4CPI+β5GOV+β6INV+u1

Inside :

β1: Intercept factor

β2 : Angular coefficient of variable EX

β3: Angular coefficient of variable SAVING

β4: Angular coefficient of variable CPI

β5: Angular coefficient of variable GOV

β6 : Angular coefficient of variable INV

ui: Population random error corresponding to observation, which represents other

factors affecting GDP but not mentioned in the model.

5
2.2. A random sample regression model

(PRF) VNI= ^
β 1+ ^
β 2EX+ ^
β 3SAVING+ ^
β 4 CPI+ ^
β 5GOV+ ^
β 6INV+u1

Inside:
^
β 1 :estimate of intercept

^
β 2: the estimated slope of the variable EX

^
β 3: the estimated slope of the variable SAVING

^
β 4 : the estimated slope of the variable CPI

^
β 5: the estimated slope of the variable GOV

^
β 6: the estimated slope of the variable INV

u1: remainder, estimate of random error

3. Description of the data

- Data source: Data taken from reliable addresses such as: General Statistics
Office, World Bank data

- Number of observation

There are 56 observations. Although the number of observations is not really large,
the reason is that this is a macro data that is concentrated in only one country and
within the limits of the group's ability to collect, but we find it still has enough
reliability to build statistical models.

- Year of survey: Surveyed the US for 56 years from 1970 to 2015

- Meaning of the variable

Variables Description Unit Predicted Effect

GDP gross domestic product million

USD

EX Exports of goods and services % of GDP +

6
 SAVING total domestic savings % of GDP -

CPI Consumer price index Index -

GOV General government final % of GDP -/+

consumption expenditure

INV Foreign direct investment, net % of GDP +

inflows

4. Statistics description of variables

Using the SUM statement in Stata to describe the independent and dependent
variable, obtaining the result:

We have the following observations:

EX: Exports of goods and services of the US during the period of 46 years from
ranged [5.40525 , 13.69204] (% of GDP) where the average value of exports of goods
and services was 9.52712%, standard deviation is 2.135192

SAVING: total domestic savings of the US during the period of 46 years ranged
[13.84964 , 23.78586] (% of GDP) where the average value of total domestic savings
for that period was 19.79197%, standard deviation is 2.135192

7
CPI: consumer price index of the US during the period of 46 years ranged [17.8051 ,
108.6957] (index) where the average value of consumer price index for that period
was 63.65407 index, standard deviation is 28.49765

GOV: general government final consumption expenditure of the US during the period
of 46 years ranged [13.9869 , 17.96184] (% of GDP) where the average value of
general government final consumption expenditure for that period was 15.75185%,
standard deviation is 1.022773

INV: foreign direct investment, net inflows of the US during the period of 46 years
ranged [0.0661 , 3.40532] (% of GDP) where the average value of foreign direct
investment, net inflows for that period was 1.106695%, standard deviation is
0.8594545

GDP: gross domestic product of the US during the period of 46 years ranged
[1073.303 , 18238.3] (USD) where the average value of GDP for that period was
7828.898 USD, standard deviation is 5265.045

- Table of correlation matrix and relationships between variables

Before running the regression model, we consider the degree of correlation between
the variables using corr command in Stata with selected variables as GDP, EX,
SAVING, CPI, GOV and INV. We obtained the correlation table between variables as
follows:

8
Based on the correlation coefficient matrix between the independent variables above,
we see:

r(INV,GOV)= -0.7083 which means that domestic private investment and government
spending are negatively correlated at a high level

r(INV,CPI)= 0.7587 shows that domestic private investment has a high positive
correlation with the consumer price index

r(INV,SAVING)= -0.3690 it follows that total domestic savings and domestic private
investment have a low negative correlation

r(INV,EX)= 0.6826 shows that there is a high correlation between goods and services
exports and domestic private investment.

r(INV, GDP) = 0.7470 shows that gross domestic product per capital and foreign
direct investment are highly correlated

r(GOV,CPI)= -0.6261 infer that the consumer price index and general government
final consumption expenditures have a rather high negative correlation

r(GOV,SAVING)= 0.1110, so there is a fairly low positive correlation between total

domestic savings and government spending.

r(GOV,EX)= -0.5718 shows that government spending and exports of goods and
services are negatively correlated on average

r(GOV,GDP)= -0.5526 which means that gross domestic product per capital and
general government final consumption expenditure is negatively correlated on average

r(CPI,SAVING)= -0.7222 shows that the consumer price index and total domestic
savings have a high negative correlation.

r(CPI,EXP)= 0.8804, so there is a very high negative correlation between exports and
consumer price index.

r(CPI,GDP)= 0.9809 which means that the gross domestic product and the consumer
price index have an extremely high correlation.

r(SAVING,EX)= -0.5275 shows that there is an average negative correlation between

exports and savings
9
r(SAVING,GDP)= -0.6772 shows that gross domestic product per capital and savings
have a rather high negative correlation

r(EX, GDP)= 0.8746 means that GDP and exports have a very high correlation.

In general, the variables have a fairly high correlation with each other. The GDP
variable has the strongest correlation with the variables EX (correlation coefficient
laf0.8746), CPI (correlation coefficient 0.9809) and INV (correlation coefficient
0.7470), this means gross domestic product per capital is heavily influenced by the
consumer price index, total exports of goods and services and foreign direct
investment. Their correlation coefficient has a positive sign and gradually approaches
1, showing a close linear and positive relationship between them. In addition, it can be
seen that the correlation relationship between the independent variables INV, GOV
and CPI is also relatively high. The highest correlation coefficient is between GDP
and CPI because these are two closely related indicators in macroeconomics, so it is
very likely that the model will have multicollinearity.

III. Estimation of Econometric Model

1. Regression model

10
The coefficient: R2= SSESST

It means that the independent variables in the model (EX, SAVING, CPI, GOV, INV )
can explain 98.47% of the variation in the dependent variable (GDP).

So, 2.53% of the sample variation of GDP is explained by other variables that are not
included in the model. 

Other indicators:

Adjusted coefficient of determination adj R- squared = 0.9847

Total Sum of Squares SST = 1.2474e+09

Explained Sum of Squares SSE = 1.2283e+09

Residual Sum of Squares SSR = 19108998.5

The degree of freedom of Model Dfm = 5

The degree of freedom of residual Dfr = 40

Variable 𝛃 t P-value Confidence Interval

11
 _cons -37813.67 -8.42 0.000 [-46891.96;-28735.39]

Export -124.4053 -1.13 0.266 [-347.4597;98.64914]

Saving 544.4554 5.95 0.000 [359.5299;729.3808]

CPI 244.078 17.30 0.000 [215.5649;272.5911]

Government 1283.943 7.22 0.000 [924.7117;1643.174]

Investment 262.871 1.25 0.218 [-161.2991;687.0411]

From the above estimated result, we obtain the sample regression function as follow:
^ = -37813.67 - 124.40653*Export + 544.4554*Saving + 244.078*CPI +
GDP
1283.943*Gov + 262.871*Investment + u^

The model shows that: Export, Saving, Investment, Government and Consumer Price
Index have an impact on Gross Domestic Product.

Meaning of Partial Regression Coefficients

For β^1: When the variables EXP, SAVING, INV, GOV, CPI have values equal to 0,
the average GDP is -37813.67 units, which is the average influence of other factors
not included in the model on GDP. .

For ^
β 2: When other factors are held constant and if the total export value increases
(decreases) by 1 unit, the gross domestic product per capita decreases (increases) by
124.4053 units.

For ^
β 3: All other things being equal and if gross domestic saving increases (decreases)
by 1 unit, gross domestic product per capita increases (decreases) by 544.4554 units.

12
For ^
β 4 : When other factors are held constant and if the consumer price index increases
(decreases) by 1 unit, the gross domestic product per capita increases (decreases) by
244.078 units.

For β^5: All other things being equal, if government spending increases (decreases) by
1 unit, the gross domestic product per capita increases (decreases) by 1283.943 units.

For ^
β 6: All other things being equal, and if total domestic investment increases
(decreases) by 1 unit, gross domestic product per capita increases (decreases) by
262.871 units.

2. Check the suitability of the model

This test is to consider whether the parameters of an independent variable at the same
time equal to 0 can occur or not.

H0: R2 =0

H1: R2≠ 0

Method 1: P value method

If the Prob> F value is smaller than the significance level α = 0.05, then reject H0,
accept H1, which means the regression model is suitable

Have: Prob> F = 0.0000 <0.05 Reject H0, accept H1.

Conclusion: The pattern is consistent at the 5% significance level.

Method 2: Testing overall significance of a regression

H0: R2=0

H1: R2≠0

13
 2
R /k 0.9847 /5
F= 2 = = 437,64
(1−R )(n−k −1) (1−0.9847)/(40−5−1)

Cα n−k−1= C0.0534 = 2.032

Have: F = 437,64 > 2.032 => Reject H0, the model is significant

3. Examination of disability regression result

3.1. Multicollinearity

Multicollinearity happens when independent variables have strong ( but not exact)
correlation.

The problem of Multicollinearity can be detected by examining the correlation matrix

of regressors and carrying out auxiliary regressions amongst them. In Stata, the vif
command is used, which stands for variance inflation factor. The table shows the
result.

The value of VIF here is lower than 10, indicating that multicollinearity is not too
worrisome a problem for this set of data.

14
3.2. Heteroskedasticity

Heteroscedasticity indicates that the variance of the error term is not constant,
rendering least squares calculations inefficient and T and F test results potentially
deceptive. Heteroscedasticity can be discovered by charting the residuals against each
of the regressors, most commonly using the White's test. It is possible to fix this by
respecifying the model - seek for other missing variables. The imtest, white command,
which stands for formation matrix test, is used in Stata.

The test results with imtest, white command showed that Prob> chi2 = 0.0882 > 0.05

At the 5% significance level, there is enough evidence to not reject the null hypothesis
and conclude that this set of data meets Homoscedasticity.

4. Hypothesis Testing
15
4.1. Critical value

- Variable EX
❑
Ho: β EX = 0
❑
H1: β ❑EX ≠ 0
^ ❑ ❑
❑ β❑ EX −β❑ EX −124.4053−0
+ t ❑s = = = -1.13
Se ¿ ¿ 110.3642

+ n= 46, k= 5

C α ,n−k−1=C ❑0.05,40=¿2.021

+ |ts|=−1.13<C ❑α , n−k−1=¿ Not reject Ho

Export has no statistically effect on GDP

- Variable SAVING
❑
Ho: β ❑SAVING= 0

H1: β ❑SAVING ≠ 0
^
β❑ SAVING −β ❑SAVING 544.4554−0
+ t ❑s= = =5.95
Se (β ❑SAVING ) 91.49855

+ n=46, k=5

C α ,n−k−1=C ❑0.05,40=¿2.021

+ |ts|=5.95>C ❑α , n−k−1=¿ reject Ho

Domestic saving has statistically significant effect on GDP

+ Variable CPI
❑
Ho: β X 1= 0
❑
H1: β ❑X 1 ≠ 0
^ ❑ ❑
❑ β❑CPI −β ❑CPI 244.078−0
+ t ❑s = = = 17.30
Se ¿ ¿ 14.10787

+ n= 46, k= 5

16
 C α ,n−k−1=C ❑0.05,40=¿2.021

+ |ts|=17.30>C ❑α , n−k−1=¿ reject Ho

Consumer price index has statistically significant effect on GDP

- Variable GOV
❑
Ho: β ❑X 2= 0

H1: β ❑X 2 ≠ 0
^
β❑GOV −β ❑GOV 1283.943−0
+ t ❑s= = =7.22
Se (β ❑GOV ) 177.7425

+ n=46, k=5

C α ,n−k−1=C ❑0.05,40=¿2.021

+ |ts|=7.22>C❑α , n−k−1 =¿ Reject Ho

Government Spending has statistically significant effect on GDP

- Variable INV
❑
Ho: β X 1= 0
❑
H1: β ❑X 1 ≠ 0
^
β❑ INV −β ❑INV 262.871−0
❑ ❑
❑
+ t ❑s = = = 1.25
Se ¿ ¿ 209.8735

+ n= 46, k= 5

C α ,n−k−1=C ❑0.05,40=¿2.021

+ |ts|=1.25<C ❑α , n−k−1=¿ Not reject Ho

INV has no statistically effect on GDP

4.2. Confidence interval

- Variable EX

17
Step 1: Set up hypothesis

H o : βEX = 0

H 1: βEX ≠ 0

Step 2: Calculation the 95% confidence interval of βGDP

βEX ∈( ^
β EX - C α se ( ^
β EX ¿ ¿; ( ^
β EX + C α se ( ^
β EX ¿ ¿)

βEX ∈ ( (−124.405 - 2.021*110.3642); (¿ + 2.021*110.3642))

βEX ∈ (-347.45; 98.641 )

Step 3: Rule of rejection

βex = 0 belong to the confidence interval => Do not reject H 0

⇒ Export has no statistically effect on GDP

- Variable SAVING

Step 1: Set up hypothesis

H o : βsaving = 0

H 1: βsaving ≠ 0

Step 2: Calculation the 95% confidence interval of βGDP

βsaving ∈( ^
β saving - C α se (^
β saving ¿ ¿; ( ^
β saving + C α se (^
β saving ¿ ¿)

βsaving ∈ ( (544.4554 - 2.021*91.49855 ); (544.4554 + 2.021*91.49855 ))

βsaving ∈ (359.5358; 739.3729 )

Step 3: Rule of rejection

βsaving = 0 doesn’t belong to the confidence interval => reject H 0

⇒ Domestic saving has statistically significance effect on GDP

- Variable CPI

Step 1: Set up hypothesis

H o : βcpi = 0

18
 H 1: βcpi ≠ 0

Step 2: Calculation the 95% confidence interval of βGDP

βcpi ∈( ^
β CPI - C α se ( ^
β CPI ¿ ¿; ( ^
β CPI + C α se ( ^
β CPI ¿ ¿)

βcpi ∈ ( (244.078 - 2.021*14.1078); (244.078 + 2.021*14.1078 ))

βcpi ∈ (215.566; 272.5898)

Step 3: Rule of rejection

βcpi = 0 doesn’t belong to the confidence interval => reject H 0

⇒ CPI has statistically significance effect on GDP

- Variable GOV

Step 1: Set up hypothesis

H o : βgov= 0

H 1: βgov ≠ 0

Step 2: Calculation the 95% confidence interval of βGDP

βgov ∈( ^
β GOV - C α se (^
β GOV ¿ ¿; ( ^
β GOV + C α se (^
β GOVI ¿ ¿ )

βgov ∈ ( (1283.943 - 2.021*177.7425); (1283.943 + 2.021*177.7425))

βgov ∈ (924.725; 1643.16)

Step3: Rule of rejection

βgov = 0 doesn’t belong to the confidence interval => reject H 0

⇒ GOV has statistically significance effect on GDP

- Variable INV

Step 1: Set up hypothesis

H o : βinv= 0

H 1: βinv ≠ 0

Step 2: Calculation the 95% confidence interval of βGDP

19
 βinv ∈( ^
β INV - C α se ( ^
β INV ¿ ¿; ( ^
β INV + C α se ( ^
β INV ¿ ¿)

βinv ∈ ( (262.871 - 2.021*209.873); (262.871 - 2.021*209.873))

βinv ∈ (-161.282; 687.024)

Step3: Rule of rejection

βinv = 0 belong to the confidence interval => Not reject H 0

⇒ INV has no statistically significance effect on GDP

IV. Result analysis & policies implication

EX: As: coefficient of exper= -124.4063 <0, p-value>0.05-> Not reject Ho

Total export value has no statistical effect on GDP.

SAVING: As coefficient of exper = 544.4554 >0, p-value<0.05 -> Reject Ho

Domestic saving has a statistically significant effect on GDP. Higher saving, higher
GDP. In particular, with the sample we have, the estimated result shows that one more
year in Saving will increase average GDP by 544.4554 million USD/ year, holding
other factors

=> To improve economic growth, people should improve their Domestic savings

CPI: As coefficient of exper= 224.078 > 0, p-value < 0.05 -> Reject Ho

Consumer price index has a statistical effect on GDP.

Higher consumer, higher GDP.

In particular, with the sample we have, the estimated result shows that one more year
in Consumer will increase average GDP by 224.078 million USD per year, holding
other factors

=> To improve global economic, people should improve their consumer price index

GOV: As coefficient of exper = 1283.943 > 0, p-value < 0.05 => reject Ho

General government's final consumption expenditure has a statistical effect on GDP.

Higher government, higher GDP

20
In particular with the sample we have, the estimated result shows that one more year
in government will increase average GDP by 1283.943 million USD per year, holding
other factors.

=> To improve growth economy, people should improve their general government

INV: As coefficient of exper = 262.871 > 0, p-value > 0.05 -> Not reject Ho

Foreign direct investment has no statistical effect on GDP

Conclusion

The US economy is a mixed economy with many components, with great

influence on the global economy. Economic growth in the US tends to be steady and
slow instead of booming, but it is still one of the fastest growing countries in the
world.

Based on the theory of macroeconomic factors affecting economic growth as

well as empirical research results in the world, and at the same time to be consistent
with economic conditions and information, the essay selected macro variables
including: Consumer Price Index (CPI), total export value (EX), total Domestic
Savings (SAVING), total domestic private investment (INV), Government Spending
(GOV) to the US economic growth in the period from 1960 to 2015. The above
research results have given us a clear and relatively complete view of the effects of
four macroeconomic variables to economic growth.

The obtained STATA software results show that all 4 variables Export, Saving,
Investment, Government and Consumer Price Index have an impact on Gross
Domestic Product. In which, there are 2 variables ( have a positive impact on GDP;
three variables GOV, SAVING, CPI have a negative impact on GDP. This result is
consistent with the theory as well as previous experimental studies. Except for 2
variables EX and INV, all other macro variables in the model are statistically
significant with 95% confidence.

21
 Finally, this report has suggested some more solutions to affect the economic
growth of the US through the independent variables studied in the model.

REFERENCES

● World Bank website:

1. https://data.worldbank.org/indicator/NY.GNS.ICTR.ZS

2. https://data.worldbank.org/indicator/NE.EXP.GNFS.ZS?locations=US

3. https://data.worldbank.org/indicator/NE.CON.GOVT.CD?locations=US

4. https://data.worldbank.org/indicator/FP.CPI.TOTL?locations=US

5. https://data.worldbank.org/indicator/BX.KLT.DINV.WD.GD.ZS?
locations=US

6. https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=US

7. https://www.investopedia.com/terms/e/economicgrowth.asp

8. https://hardeebusiness.com/resources/measuring-economic-growth-and-
development

9. Aghion, Comin, Howitt. 2006. When does domestic saving matter for
economic growth?. National Bureau of economic research No. 12275

10. Boldeanu, Constantinescu. 2015. The main determinants affecting economic

growth. Series V: Economic Sciences Vol. 8 (57) No. 2.
22
11. Mahmoud. 2015. Consumer price index and economic growth: A case study of
Mauritania 1990-2013. Asian Journal of Empirical Research, 5(2)2015: 16-23.

12. M. Pereira, Z.Xu. 2000 Export Growth and Domestic Performance. Review of
International Economics, 8(1), 60–73.

Appendix

 Commands and results in STATA

* Statistic description of variable:

* Regression model:

23
* P-value method

* Use the variance inflation factor (VIF).

* White test

24
 Table data

YEAR GDP EX SAVING CPI GOV INV

1970 1073.30300 5.56311 21.55952 17.80510 17.96184 0.11367

1971 1164.85000 5.40525 21.47822 18.56943 17.93879 0.06610

1972 1279.11000 5.53846 22.10881 19.17707 17.62929 0.09929

1973 1425.37600 6.68378 23.78586 20.36179 16.77628 0.13540

1974 1545.24300 8.19612 22.68342 22.61274 17.16267 0.22909

1975 1684.90400 8.23228 20.91526 24.68026 17.61080 0.13710

1976 1873.41200 7.98089 21.46458 26.09810 16.78798 0.15533

1977 2081.82600 7.65429 22.20820 27.79491 16.38797 0.14026

1978 2351.59900 7.94706 23.42848 29.91593 15.76672 0.23388

1979 2627.33300 8.75903 23.51993 33.28281 15.40364 0.30639

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1980 2857.30700 9.82646 22.19705 37.79237 15.87684 0.58587

1981 3207.04100 9.51778 23.35467 41.69810 15.81024 0.80074

1982 3343.78900 8.46973 21.78403 44.25479 16.58385 0.63491

1983 3634.03800 7.62226 19.79258 45.67644 16.38379 0.31645

1984 4037.61300 7.48908 21.90636 47.64078 15.72038 0.62487

1985 4668.97900 6.98807 20.36110 49.32995 15.91711 0.22194

1986 4579.63100 7.00925 18.95655 50.26625 16.11460 0.67573

1987 4855.21500 7.49592 19.61687 52.10829 16.00121 1.30241

1988 5236.43800 8.49052 20.63145 54.23313 15.66817 1.08681

1989 5641.58000 8.93879 19.74651 56.85097 15.62380 1.34324

1990 5963.14400 9.25473 18.75605 59.91976 15.90077 1.19450

1991 6158.12900 9.66091 18.81002 62.45734 16.31757 0.56105

1992 6520.32700 9.70891 17.68152 64.34906 16.07869 0.46485

1993 6858.55900 9.54718 17.04342 66.24842 15.64527 0.73237

1994 7287.23600 9.89315 17.85203 67.97581 15.20605 0.76764

1995 7639.74900 10.63922 18.74780 69.88282 14.94477 0.90422

1996 8073.12200 10.74664 19.63808 71.93123 14.52832 1.20969

1997 8577.55446 11.11975 20.83215 73.61276 14.22932 1.42407

1998 9062.81820 10.51526 21.37769 74.75543 13.98690 2.32985

1999 9630.66420 10.30988 20.91678 76.39110 14.03254 3.24431

10252.3454
2000 6 10.69132 20.79558 78.97072 14.02204 3.40532

10581.8214
2001 0 9.70355 19.62954 81.20257 14.53579 1.63012

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 10936.4190
2002 5 9.12528 18.32881 82.49047 15.04898 1.01546

11458.2438
2003 8 9.03424 17.38851 84.36308 15.24124 1.02202

12213.7291
2004 5 9.63148 17.70245 86.62168 15.16261 1.74919

13036.6402
2005 3 9.98401 18.09167 89.56053 15.05010 1.09188

13814.6114
2006 1 10.64214 19.16163 92.44971 15.00551 2.16049

14451.8586
2007 6 11.48153 17.40307 95.08699 15.21280 2.39840

14712.8440
2008 8 12.47400 15.07795 98.73748 15.99582 2.31833

14448.9330
2009 3 10.95426 13.84964 98.38642 16.84158 1.11484

14992.0527
2010 3 12.38821 15.35438 100.00000 16.74918 1.76119

15542.5811
2011 0 13.61334 16.32032 103.15684 16.15762 1.69532

16197.0073
2012 5 13.69204 18.66184 105.29150 15.53027 1.54563

16784.8492
2013 0 13.62527 19.08890 106.83385 15.08888 1.71661

17527.1637
2014 0 13.56413 20.21307 108.56693 14.64158 1.43695

2015 18238.3005 12.43894 20.20807 108.69572 14.30497 2.80418

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7

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