Trade liberalisation and the composition of investment: theory and African application
AbstractTrade Liberalisation affects not only the aggregate level of investment but also its composition. We present evidence that African trade liberalisations have been associated with sharp shifts in the composition of investment: investment involving tradable capital goods (equipment) has fallen while investment involving non-tradable (structures) has boomed. The paper presents two models which can account for this compositional change. The combination of imperfect credibility of trade reform in Africa and the switch to structure which ( under full credibility ) is optimal in these models may explain the disappointing export response in African trade liberalisations.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Centre for the Study of African Economies, University of Oxford in its series CSAE Working Paper Series with number 1996-04.
Date of creation: 1996
Date of revision:
Other versions of this item:
- Paul Collier and Jan Willem Gunning, 1996. "Trade liberalisation and the composition of investment: theory and African application," Economics Series Working Papers WPS/1996-04, University of Oxford, Department of Economics.
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Alemayehu Geda, 2006. "Openness, Inequality and Poverty in Africa," Working Papers 25, United Nations, Department of Economics and Social Affairs.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Payne).
If references are entirely missing, you can add them using this form.