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The Rewards and Challenges of Export-Led Strategies

Author

Listed:
  • Hany H. MAKHLOUF

    (School of Business and Public Administration, University of the District of Columbia, USA.)

Abstract

The economic achievements of post- WWII Japan and Germany, the success of the Asian Four Tigers in the 1970s and 1980s, and the impressive growth of China, after adopting an export-led strategy in 1978, have caused many nations to view the export-ledmodel as the fastestroute to economic growth and financial stability. As a result, many governments started to promote and protect their countries’ exports,and mix politics, diplomacy and trade as well as seek greater access to friendly countries’ markets. Export-led development strategies, however, carry some risks, such as increased dependence on foreign markets and political forces that are beyond the exporters’ control. Global market forces, at times, cause export-dependent countries to have a sudden decline in their export revenues as the oil exporting countries have been experiencing as a result of a sharp decline in the world price of crude oil since 2014. This paper examines the main benefits, costs, and risks associated with export-led strategies, particularly as adopted by developing countries. It further explores the motives and risks faced by individual companies as they sell some of their products outside their home markets.

Suggested Citation

  • Hany H. MAKHLOUF, 2016. "The Rewards and Challenges of Export-Led Strategies," Journal of Economics and Political Economy, KSP Journals, vol. 3(3), pages 440-445, September.
    • Handle: RePEc:ksp:journ1:v:3:y:2016:i:3:p:440-445
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    References listed on IDEAS

    as
    1. Nelson, Richard R & Pack, Howard, 1999. "The Asian Miracle and Modern Growth Theory," Economic Journal, Royal Economic Society, vol. 109(457), pages 416-436, July.
    2. Thomas I. Palley, 2011. "The Rise and Fall of Export-led Growth," Economics Working Paper Archive wp_675, Levy Economics Institute.
    3. Christian Dustmann & Bernd Fitzenberger & Uta Sch?nberg & Alexandra Spitz-Oener, 2014. "From Sick Man of Europe to Economic Superstar: Germany's Resurgent Economy," Journal of Economic Perspectives, American Economic Association, vol. 28(1), pages 167-188, Winter.
    4. Jie Yang, 2008. "An Analysis of So-Called Export-led Growth," IMF Working Papers 2008/220, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Import substitution; Trade liberalization; Infant industries; Export promotion; Foreign investment; Export infrastructure.;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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