دانلود IMPACT OF OIL PRICE ON ECONOMIC GROWTH: A STUDY OF BRIC NATIONS

Abstract

This paper employed an empirical analysis to examine the impacts of oil price on GDP of the four largest fast growing emerging economies Brazil, Russia, India and China known collectively as the BRIC countries using a sample of observations from 1987 to 2014. The first step in the empirical analysis involved testing the normality of time series. Then the Ordinary Least Square (OLS), Fixed Effect Model (FEM) And Random Effect Model (REM) were used to find out Impact of Oil Price on GDP. To choose between Fixed Effect Model and Random Effect Model the Hausman test was applied because it has an asymptotic chi-square distribution. The results of Hausman test indicated that, the Fixed Effect Model was the most appropriate model for the study therefore finally the dummy variables were used to estimate the Fixed Effect Model.  The result shows that, overall the Oil Price has a positive relationship with GDP. The negative coefficient values of China (-3.284280) and India (-0.086646) shows that, Increase in Oil Price has a negative relationship with GDP and on the other side the Positive coefficient values of Russia and Brazil depict the positive impact of increased Oil Price on GDP.