The Contrubution of Agriculture, Industry, Construction and Services in Gdp Growth

Topics: Regression analysis, Econometrics, Linear regression Pages: 37 (6025 words) Published: April 7, 2013
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THE CONTRUBUTION OF AGRICULTURE, INDUSTRY, CONSTRUCTION AND SERVICES IN GDP GROWTH| |
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1/25/2013|

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1.Introduction3
2.Literature Review4
3.Multiple regression6
3.1 Descriptive Statistics7
3.2 Correlations7
3.3 Regression9
3.4 Calculations10
3.5 Statistical significance of the coefficients of the model:11
3.5.1 The importance of Constant a0 coefficient11
3.5.2 The importance of a1 coefficient (Agriculture)11
3.5.3 The importance of a2 coefficient (Industry)12
3.5.4 The importance of a3 coefficient (Construction)12
3.5.5 The importance of a4 coefficient (Services)12
3.6 Overall importance of the model:13
4.Simple regression13
4.1 The relationship between GDP and Agriculture13
4.2 The relation between GDP and the Industry16
4.3 The relationship between GDP and Construction18
4.4 The relationship between GDP and Services20
5. Multicollinearity22
5.1 Regression analysis for each independent variable23
5.1.1 Regression (Agriculture as dependent variable)23
5.1.2 Regression (Services as dependent variable)24
5.1.3 Regression (Industry as dependent variable)25
5.1.4 Regression (Construction as dependent variable)26
5.2 The correlations between the independent variables27
6.Conclusions28
7. Bibliography29

Abstract
In this project we will present relation that exist among GDP and other sectors of economy such as Agriculture, Industry, Construction and Services. Methodology that is used is based on the building of an econometric model that use GDP as dependent variable and economic sectors that we mentioned as independent variables. Institute of statistic is the source of the data that are used in our project. The aim of this job is to show the importance of these model ,what role have this economic factor in GDP, which of these factors is more important and in which percentage this model is been explained from these variables or factors that we have take in consideration. Mainly this job is done by using statistic analysis that help us to explain the model. By using correlation matrix, we reach to a conclusion that there is a strong, positive and statistically significant relationship between GDP and these sectors of economy especially between GDP and agriculture.

1. Introduction
A large number of studies have analyses the relationship between economic sector and economic growth. These studies have included both Multiple linear regression and correlation. The main objective of this study is to examine the relationship between economic sector and economic growth ( GDP) for Albania.GDP is the monetary value of all the finished goods and services produced within a country's borders in a specific time period. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory. GDP is commonly used as an indicator of the economic health of a country, as well as to gauge a country's standard of living. As the dependent variable (Y) is taken GDP, while the independent variables are taken: X1-Agriculture, X2-Industry, X3-Construction and X4-Services. The model in this case would be:

Y = a0 + a1*X1 + a2*X2 + a3*X3 + a4*X4 + ei
In this project we will see which is the contribution of economic sector in the increase of the gross domestic products. We have taken in consideration in the study four important sectors of economy which are industry, construction agriculture and services. Our expectations are that these variables will have an considerable impact in the GDP growth because they are very important factors in Albanian economy. Anyway we will see while we will build econometric model and making statistic analysis which of these variables is more or less important which represent the main methodology of these study. In the first part of the project is a short review of literature. Than is...