On Export-Led Growth: Is Manufacturing Exports a New Engine of Growth for Bangladesh?

The study attempts to empirically verify the export-led growth hypothesis for Bangladesh. In this context, we examine whether manufacturing exports has become a new engine of export-led growth replacing total exports, as claimed by the so-called de novo hypothesis. The empirical analysis, based on the vector error correction modelling (VECM), suggests that both total exports and manufacturing exports have both long run and contemporaneous effects on the growth of GDP as well as manufacturing output. According to the non-nested tests, total exports emerges as the engine of export-led growth (i.e., GDP). For manufacturing output, however, both total exports and manufacturing exports emerge as engines of growth. Therefore, manufacturing exports is not the sole determinant of the export-led growth for Bangladesh.