Cointegrating and causal relationships between saving and growth: The case of Iran / Nur Fakhzan Marwan …[et al.]

This paper examines the long-run causal relationship between saving and economic growth for Iran for the period 1967-2010. Applying the multivariate cointegration techniques and Toda and Yamamoto causality test, it is found that the stability of savings-led growth hypothesis in the long run is not applied for this country. On the other hand, it is found that there is a unidirectional causality running from economic growth to saving for Iran. Evidently, the empirical results cast further doubt on the relevance of the domestic saving used as a target variable for economic development.