Determinants of Labor-intensive exports by the Developing Countries : A Cross Country Analysis
AbstractWhile it is widely recognized that industrial development is imperative in developing countries to reduce poverty and to attain sustainable economic growth, there is no consensus on how to develop industries and where to start. Generally, the literature argues that developing countries should concentrate on promoting labour intensive industries and exports first due to their low capital stock and relatively abundant labor force. Though many developing countries are attempting to follow this path, the interesting observation is that not all developing countries are reaping the benefits of promoting labor intensive industries in terms of employment generation and sustaining economic growth. This raises an important question as to how it is possible for some developing countries to enjoy more benefits from labor intensive industries, while others are not able to do so. Using cross-country panel data in explaining heterogeneous performance in exporting labor intensive products by the developing countries, an attempt has been made in this paper to identify the important factors over and above the conventional factors such as low labor wages that contribute to the sustained growth of labor intensive exports from developing countries. The empirical findings of this paper emphasizes that even to initiate and sustain the growth of the low value added industries, such as garments, the developing countries should develop basic infrastructure and maintain a friendly business environment.
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Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Trade Working Papers with number 23304.
Date of creation: Jul 2012
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Developing country; Garment and textile export; Infrastructure; Business Environment; Asia; Sub-Saharan Africa.;
Other versions of this item:
- Mottaleb Khondoker & Kaliappa Kalirajan, 2012. "Determinants of Labor-Intensive Exports by the Developing Countries: A Cross Country Analysis," ASARC Working Papers 2012-09, The Australian National University, Australia South Asia Research Centre.
- Mottaleb Khondoker & Kaliappa Kalirajan, 2012. "Determinants of Labor-intensive exports by the Developing Countries : A Cross Country Analysis," EABER Working Papers 23304, East Asian Bureau of Economic Research.
- L67 - Industrial Organization - - Industry Studies: Manufacturing - - - Other Consumer Nondurables
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- O14 - Economic Development, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
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