An Exploratory Analysis of Related Macroeconomic Indicators as Determinants to Economic Growth

Abstract

The relative movement of certain individual economic indicators to the movement of per capita income is a well-researched field. In addition to that space, this study aimed at regressing economic development in terms of per capita incomes to selected miscellaneous indicators. This by itself may not be a new approach to understanding the interrelationships that exist between other relevant economic parameters, but localized and exploratory research in this regard does prove to have some key insights regarding the interactions of economic indicators in the Philippines. Using the Classical Linear Regression Model (CLRM), The results show that increases in Net Domestic Credit, Foreign Direct Investment, and Ratio of Female to Male Labor Participation Rate increased per capita income significantly, while increases in Real Interest Rate and Carbon Dioxide Emissions decreased per capita income significantly. This meant that increasing credit and investment and incorporating more women into the labor force is a significant impetus for growth and development, while environmental degradation and the high cost of borrowing harms it.