Econ Hypothesis

Lexi De Forest
Econ 204-002 Writing Assignment
Hypothesis 3-False
“In Egypt, the changes in high-tech exports (% of manufacturing exports) and the changes in real GDP are positively correlated over time”
This hypothesis covers the [technological knowledge] aspect of a country’s productivity. Without inputs in the technology of companies throughout a country, development would be stagnant and would tamper the ability to expand and multiply. High-technology exports account for the products with high R&D intensity, such as in aerospace, computers, pharmaceuticals, scientific instruments, and electrical machinery. A country only has so many resources to dedicate to exports of this magnitude and most exports in smaller countries do not account for much if any high-technology inputs. These high-technology exports also require a great deal of human capital which most countries do not spend time and money to offer. In Egypt especially, it is necessary to focus most attention on lower-technology exports to actually make a decent dollar.
This hypothesis would be rendered false because of data reported to the World Bank. According to our statistics, from 2005 to 2008, the percent of high-tech exports were 0, 1, 0 and 1 respectively. It would not behoove Egypt to spend waste human capital on exports when this sort of technology, if required, would be imported to save time, money, and manpower. GDP growth from 2005 to 2008 was reported as 4.5, 6.8, 7.1, and 7.2 respectively. With these numbers, our hypothesis is blatantly false. GDP number grew from 2005 to 2008 and the percentage of high-text imports fluctuated between 0 and 1.
If the numbers grew to anything beyond 1, there might be a possibility to extrapolate just a bit and report that in 2006 and 2008, GDP and high-tech exports were positively correlated. But as our facts were not reported as so, it would be pure extrapolation to do so. As Egypt’s GDP rose each year, we can deny any relation between the two.... [continues]

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