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Domestic institutions and export performance: Evidence for Cambodia

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  • Reth Soeng
  • Ludo Cuyvers

Abstract

The paper analyzes the relevance of domestic institutions for export performance of Cambodia. Regulatory quality, control of corruption, rule of law, government effectiveness, and political stability are introduced in an augmented gravity model with a panel data set over 1996–2015. The research is the first application to Cambodia, until 2015 a least developed country which is generally believed to have poorly developed institutions. Due to high multicollinearity among the variables, the institutional variables are introduced in the model one by one. Estimation is by the Hausman–Taylor method, which reduces or removes the correlation between the composite error terms and the included variables. All institutional variables show a highly significant positive relationship with Cambodia's exports, with rule of law having the largest impact. It is concluded that the government should give high priority to the further improvements of the legal environment and to strong enforcement of property rights and contracts.

Suggested Citation

  • Reth Soeng & Ludo Cuyvers, 2018. "Domestic institutions and export performance: Evidence for Cambodia," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 27(4), pages 389-408, May.
    • Handle: RePEc:taf:jitecd:v:27:y:2018:i:4:p:389-408
    DOI: 10.1080/09638199.2017.1386230
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    Cited by:

    1. Arief Bustaman & Rina Indiastuti & B. Budiono & Titik Anas, 2022. "Quality of Indonesia’s domestic institutions and export performance in the era of global value chains," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 11(1), pages 1-29, December.
    2. Kapri, Kul, 2021. "Court fairness and firm level export decisions," International Review of Economics & Finance, Elsevier, vol. 75(C), pages 269-277.
    3. Carlos Abreo & Ricardo Bustillo & Carlos Rodriguez, 2021. "The role of institutional quality in the international trade of a Latin American country: evidence from Colombian export performance," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 10(1), pages 1-21, December.
    4. Abdikarim Bashir Jama, 2020. "The Effect of Institutional Quality on Export performance of Middle East & North-Africa Region," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(1), pages 14-20, January.
    5. Pınar ÇUHADAR & Ömer DORU, 2020. "Institutions and International Trade Linkages: An Investigation with Panel Data Analysis on Transition Economies Abstract: The purpose of the paper is to analyze the impact of governance indicator as ," Sosyoekonomi Journal, Sosyoekonomi Society, issue 28(45).
    6. Wenshou Yan & Xi Yang, 2019. "A New Motivation for Sustainable Trade Between Countries with Different Regulatory Qualities," Sustainability, MDPI, vol. 12(1), pages 1-16, December.

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