Recommended model to predict the regional GDP per capita growth rate Prediction for GDP per capita growth rate in 2021, 2022 and 2023

ECON1193B – Semester A, 2021 Student Distribution FIRST STUDENT PART CONTRIBUTION NAM ID DISTRIBUTION % E MAI S3878898 Part 1, 3, (Conclusion for Part 3), Part (Box and Whisker), Video Powerpoint TAM S3877398 Part 5,6,7.2 (Region B), Video Script 100% ANH S3880774 Part 5,6,7.2 (Region A), Video Script 100% DUNG S3877053 Part (Median), Part (Conclusion for Part 2), Part 7.1 & 7.3, Video Presenter 100% HUY S3877033 Part (IQR), Part (Conclusion for Part 2), Part 7.1 & 7.3 100% 100% SIGNATURE ECON1193B – Semester A, 2021 Table of Contents I DATA COLLECTION .4 II DESCRIPTIVE STATISTICS .4 2.1 Central Tendency .4 2.2 Variation 2.3 Box-and-Whisker plot III MULTIPLE REGRESSION 3.1 America .6 3.2 Africa 10 IV REGRESSION CONCLUSION 11 V TIME SERIES .12 5.1 Significant trend model 12 5.2 Recommended model to predict the regional GDP per capita growth rate 18 5.3 Prediction for GDP per capita growth rate in 2021, 2022 and 2023 19 VI TIME SERIES CONCLUSION 20 6.1 Line chart 20 6.2 Recommended model to predict the world GDP per capita growth rate 21 VII OVERALL CONCLUSION 21 6.1 Other factors that affect GDP per capita growth rate 21 6.2 The predicted world GDP per capita growth rate in 2030 21 6.3 Recommendations 22 VIII REFERENCES 23 IX APPENDIX 24 ECON1193B – Semester A, 2021 I Data Collection Our assigned regions are America (Region A) and Africa (Region B), and our assigned year is 2015 The report includes variables Data of variables is collected from The World Bank We collect 45 countries in America and 52 countries in Africa However, because of some missing values of some variables, we have to eliminate some countries Consequently, the final number of countries included in this report are 27 and 49 countries in America and Africa, respectively II Descriptive Statistics: Measurement of Central Tendency To check the outliers, Q1, Q3 and IQR are calculated: There is one upper outlier (5.76% > Q3+1.5*IQR) and one lower outliers (-4.351% < Q11.5*IQR) in America In Africa, there are five lower outliers (-5.609%, -6.884%, -9.661%, -12.131% and -22.312% < Q1-1.5*IQR) Due to the evidence of outliers in both datasets of America and Africa GDP per capita growth rate, the mean cannot be used to compare in this situation because of its sensitivity to outliers ECON1193B – Semester A, 2021 Moreover, the mode might not exist in the datasets, which is correct to the GDP per capita growth in America and Africa, there is no appearance of mode Therefore, the median is the most appropriate measure to analyze owing to its resistance to outliers The median of GDP per capita growth rate in America is 1.963%, meaning 50% of observations (countries) have a growth rate higher than this number Similarly, 50% of observations (countries) in Africa have the GDP per capita growth rate higher than 0.974% Additionally, the median of America is higher than Africa, showing that GDP per capita growth rate in 2015 of America is higher than that figure of Africa Measurement of Variation In general, all the figures of Africa are excessively higher than that of America Due to the sensitivity to outliers, sample variance, standard deviation, coefficients of variation, standard deviation, and range are not applicable IQR is not susceptible to outliers, hence, it is the most suitable measure to compare these GDP per capita growth rates in both regions The IQR of GDP per capita growth rate in Africa (3.445%) is larger than the IQR in America (2.08%), which is about 1.656 times greater This figure shows that the GDP per capita growth rate in Africa is more fluctuated than that in America ECON1193B – Semester A, 2021 Box-and-Whisker Plot Both GDP per capita growth rates in America and Africa had right-skewed shape (mean > median) There are lower outliers in Africa, and the lowest number is even -22.312%, indicating that there are many countries with extremely low GDP per capita growth rates Meanwhile, the lowest number in America is only -4.351% Additionally, the left-whisker of Africa (-3.186% to -0.345%) is located in the lower position than the left-whisker of America (1.507% to 0.53%) Therefore, it can be concluded that the GDP per capita growth rate in Africa is extremely lower than that in America III Multiple Regression: America ECON1193B – Semester A, 2021 P-value of Exports of goods and services (% of GDP) and Imports of goods and services (% of GDP) have #NUM! error This problem occurs because the independent column is linearly dependent on the others (multicollinearity) ECON1193B – Semester A, 2021 Therefore, we need to exclude either exports of goods and services or imports of goods and services After applying backward elimination (Appendix A): Final regression output when eliminating Exports of goods and services: Final regression output when eliminating Imports of goods and services: ECON1193B – Semester A, 2021 Both p-value of imports of goods and services and trade are lower than 0.05 However, in comparison, R-square of Imports of goods and services (19.46%) is lower than R-square of Trade (20.224%) Additionally, P-value of Imports of goods and services (0.021) is higher than P-value of Trade (0.019) Therefore, Trade is considered as the most significant independent variable Regression equation: shows that when Trade = 0%, the predicted GDP per capita growth rate of GDP per capita is – 0.3% Nevertheless, this does not make sense because X=0% is out of the observation range Slope indicates that GDP per capita will increase 0.029% for every 1% increase in Trade Positive value of indicates that the linear relationship between Trade and GDP per capita growth rate is the positive relationship R-square = 20.224% indicates that 20.224% of variation of GDP per capita growth rate can be explained by variation of Trade ECON1193B – Semester A, 2021 Africa P-value of Imports of goods and services (% of GDP) and Trade (% of GDP) have #NUM! error This problem occurs because the independent column is linearly dependent on the others (multicollinearity) 10 ECON1193B – Semester A, 2021 Appendix A.14 Seventh Regression Output Eighth Regression Output Appendix A.15 Eighth Regression Output After applying backward elimination, Trade (% of GDP) is the only one significant independent variable because P-value < 0.05 In comparison, R square of Imports of goods and services is lower than R square of Trade Additionally, P-value of Imports of goods and services is higher than P-value of Trade Therefore, Trade is considered as the most significant independent variable Africa Region Regression First Regression Output 32 ECON1193B – Semester A, 2021 Appendix A.16 First Regression Output P-value of Imports of goods and services (% of GDP) and Trade (% of GDP) have #NUM! error This problem occurs because the independent column is linearly dependent on the others Therefore, we need to exclude one of them a Situation 1: Exclude Imports of goods and services (% of GDP) Second Regression Output 33 ECON1193B – Semester A, 2021 Appendix A.17 Second Regression Output Applying backward elimination, we eliminate the independent variables having p-value>0.05 We eliminate the highest p-value step by step until we get the regression output with independent variables with only p-value0.05 We eliminate the highest p-value step by step until we get the regression output with independent variables with only p-value 0.05), hence we not reject Therefore, with a confidence level of 95%, there is no linear trend in the GDP per capita growth (annual %) of Canada from 1990 to 2015  QUA (There is no quadratic trend in the GDP per capita growth of Brazil from 1990 to 2015) (There is a quadratic trend in the GDP per capita growth of Brazil from 1990 to 2015) As p-value of two T values are smaller than (8.984 x < 0.05 & 1.362 x ), hence we reject Therefore, with a confidence level of 95%, there is a quadratic trend in the GDP per capita growth (annual %) of Brazil from 1990 to 2015 46 ... Significant trend model 12 5.2 Recommended model to predict the regional GDP per capita growth rate 18 5.3 Prediction for GDP per capita growth rate in 2021, 2022 and 2023 19 VI... trend in the GDP per capita growth rate in Seychelles from 1990 to 2015  QUA (There is no linear trend in the GDP per capita growth rate (1990 – 2015)) (There is linear trend in the GDP per capita. .. trend in the GDP per capita growth rate of Cameroon from 1990 to 2015  QUA (There is no linear trend in the GDP per capita growth rate (1990 – 2015) (There is linear trend in the GDP per capita growth