Assessing regional economic performance in the Southern Thailand special economic zone using a Vine-COPAR model

Abstract

© 2019 by the authors. Special economic zones (SEZ) can play an integral role in enhancing both regional and national economic growth. To explore the relationship between regional growth and the presence of an SEZ in Songkhla province, Thailand, the CD Vine-Copula AutoRegressive (CD-Vine COPAR) models were constructed using annual datasets of Songkhla's economic performance from 1995 to 2016. The findings indicate that the D Vine-COPAR model produced better fitting predictions for the manufacturing sector, while the C Vine-COPAR models better fit for the agriculture and service sectors. A five-year forecast (2017-2021) was also created. For Vine-COPAR-based Granger causality, the Gross Provincial Production, Foreign Direct Investment and Border Trade are evidently important contributors to regional economic development. Consequently, the government should adopt comprehensive strategies to ensure comparative advantages for operating in the region based on favorable local factors.