Marginal propensity to import and terms of trade: Panel granger causality evidence from the East African Community (EAC)

Abstract

The nexus between the terms of trade and marginal propensity to import and the consequent policy options arising from it among economic blocs is an area that has not been given due attention in the literature. The focus of the current paper is to examine the link between the marginal propensity to import and the terms of trade in the East African Community (EAC).

Keywords

• propensity to import
• terms of trade
• exchange rate
• panel granger causality
• economic bloc
• c23
• f31
• f16