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International Trade and Developing Countries: An Empirical Investigation of the Linder Hypothesis

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Author Info
McPherson, Michael A
Redfearn, Michael R
Tieslau, Margie
Abstract

This paper presents empirical evidence in support of the Linder hypothesis for five of the six East African developing countries studied here: Ethiopia, Kenya, Rwanda, Sudan and Uganda. This finding implies that these countries trade more intensively with others who have similar per capita income levels, as predicted by Linder. The contributions of this research are three-fold. First, new information is provided on the Linder hypothesis by focusing on developing countries. Second, this is one of very few analyses to capture both time-series and cross-section elements of the trade relationship by employing a panel data set. Third, the empirical methodology used in the analysis corrects a major shortcoming in the existing literature by using a censored dependent variable in estimation. Copyright 2001 by Taylor and Francis Group

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Article provided by Taylor and Francis Journals in its journal Applied Economics.

Volume (Year): 33 (2001)
Issue (Month): 5 (April)
Pages: 649-57
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Handle: RePEc:taf:applec:v:33:y:2001:i:5:p:649-57

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  1. Juan Carlos Hallak, 2004. "Product Quality, Linder, and the Direction of Trade," NBER Working Papers 10877, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Haq, Zahoor & Meilke, Karl D., 2008. "Differentiated Agri-Food Product Trade and the Linder Effect," Working Papers 46629, Canadian Agricultural Trade Policy Research Network. [Downloadable!]
  3. Juan Carlos Hallak, 2006. "A Product-Quality View of the Linder Hypothesis," NBER Working Papers 12712, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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