Regional Economic Growth and Spatial Spillover Effects in MENA Area

Abstract

T

he main objective of this study is to estimate the spatial spillover effects of the economic growth among the selected countries of MENA region. For this purpose, the Spatial Durbin Model in the framework of spatial dynamic panel data was estimated during the period of 1970-2010. The spatial Diagnostic tests affirmed the occurrence of spatial positive autocorrelation phenomenon for the real per capita income. The obtained results indicated the positive spatial spillover of the economic growth among the MENA countries and the spatial elasticity of per capita GDP was estimated 0.39 percent. Also, according to visualization results, Iran has been surrounded by countries with high per capita income; so opportunity to benefit through the creation of artificial growth poles and economic collaboration with their adjacent countries is available for Iran. Other policy implications are discussed.